Rodriguez v. GB Lodging, LLC

Background

Dionis Rodriguez alleged that he was entitled to “promote participation interests,” or shares of certain investment profits, under agreements he signed with GB Lodging in 2012 and with Anolag Jacpot 2 JV LLC in 2013. The claims concerned the Old No. 77 Property, the Beekman Street Property, and the Bond Street Property.

Rodriguez asserted nine causes of action: four breach-of-contract claims, one unjust-enrichment claim, two equitable-accounting claims, and two declaratory-judgment claims. Defendants moved to dismiss eight claims. The motion did not challenge Count Two, Rodriguez’s breach-of-contract claim under the Anolag agreement concerning the Old No. 77 Property. The court noted that defendants did not dispute that Rodriguez was owed a payment under that agreement, although the amount was disputed.

Breach-of-Contract and Declaratory-Judgment Claims

Defendants argued that Rodriguez’s claims under the Terms of Employment were barred by New York’s six-year statute of limitations. They argued that the limitations period began when Rodriguez left GB Lodging in September 2013 or, alternatively, shortly afterward when the parties failed to reach a separation agreement. Rodriguez argued that the limitations period began only after the contractual conditions for receiving the participation interests were satisfied.

The court held that deciding those issues would require interpreting whether the participation provision continued after Rodriguez’s employment ended and examining the parties’ communications and negotiations. Because the parties had not provided definitive legal authority on the contract’s silence about post-employment rights and the factual record was not sufficiently developed, the court found a ruling premature. It therefore denied without prejudice the motion to dismiss Counts One, Six, and Seven, which were the breach-of-contract claims, and denied without prejudice the motion as to Count Nine and Count Eight against GB Lodging.

The court granted the motion as to Counts Eight and Nine against Anolag, GFI Capital Resources Group, GFI Capital Holdings, Gross, and Blum. It found that Rodriguez had grouped those defendants together without explaining what legal theory entitled him to a declaratory judgment against each of them. The order did not state that these dismissals were with or without prejudice.

Unjust Enrichment

The court granted the motion to dismiss Count Three. Under New York law, an unjust-enrichment claim generally cannot proceed when a contract governs the subject matter, including against third parties who did not sign the contract. The court concluded that Rodriguez’s unjust-enrichment claim relied on the same allegations as his contract claims and that the agreements governed the dispute. The court dismissed Count Three with prejudice.

Equitable Accounting

The court granted the motion as to Counts Four and Five, which sought accounting of the Beekman and Bond Street properties. An equitable accounting requires, among other things, a fiduciary or confidential relationship. The court found no such relationship between Rodriguez and GB Lodging or Anolag, whose relationship with him was contractual, and no relationship at all—much less a fiduciary or confidential one—between Rodriguez and the remaining defendants. The opinion does not state a prejudice qualifier for these dismissals.

Disposition and Next Steps

The court held that defendants’ motion to dismiss was granted in part and denied in part. It was granted as to Count Three and Counts Four and Five; granted as to Counts Eight and Nine against Anolag, GFI Capital Resources Group, GFI Capital Holdings, Gross, and Blum; denied without prejudice as to Counts One, Six, and Seven; and denied without prejudice as to Counts Eight and Nine against GB Lodging.

The court directed the parties to confer and submit a schedule for limited discovery concerning discussions about whether the participation provision continued after Rodriguez’s employment and the parties’ discussions before and shortly after his departure. The court stated that it would reevaluate Rodriguez’s remaining claims after that discovery. The Clerk was directed to terminate the motion and dismiss all claims against GFI Capital Resources Group, GFI Capital Holdings, Gross, and Blum.