Free Reply to Response to Motion - District Court of California - California

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William J. O'Shaughnessy McCARTER & ENGLISH, LLP Four Gateway Center 100 Mulberry Street Newark, NJ 07102 (973) 622-4444 Evan R. Chesler Peter T. Barbur Elizabeth L. Grayer CRAVATH, SWAINE & MOORE LLP 825 Eighth Avenue New York, NY 10019 (212) 474-1000 Richard S. Taffet Philip L. Blum BINGHAM McCUTCHEN LLP 399 Park Avenue New York, NY 10019 (212) 705-7000 Robert N. Feltoon CONRAD O'BRIEN GELLMAN & ROHN, P.C. 1515 Market Street, Suite 1600 Philadelphia, PA 19102 (215) 864-8064 Attorneys for Defendant Qualcomm Incorporated UNITED STATES DISTRICT COURT DISTRICT OF NEW JERSEY

BROADCOM CORPORATION, Plaintiff. v. QUALCOMM INCORPORATED, Defendant. SUPPLEMENTAL DECLARATION OF WILLIAM J. O'SHAUGHNESSY IN SUPPORT OF DEFENDANT'S MOTION TO DISMISS CLAIMS FOUR THROUGH EIGHT OF PLAINTIFF'S SECOND AMENDED COMPLAINT Civil Action No. 05-3350 (MLC) (JJH)

ME1 7145490v.1

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William J. O'Shaughnessy, declares pursuant to 28 U.S.C. § 1746, as follows: 1. I am an attorney admitted to practice before all courts in the State of New

Jersey. I am a member of the law firm of McCarter & English, LLP, attorneys for defendant QUALCOMM Incorporated, and am familiar with the matters stated herein. I submit this declaration is further support of Defendant's Motion to Dismiss Claims Four through Eight of Plaintiff's Second Amended Complaint. 2. Attached hereto are true and correct copies of the following documents: Broadcom's Opposition to Qualcomm's Motion for Summary Adjudication, filed December 4, 2006, in Qualcomm Inc. v. Broadcom Corp., No. 05 CV 1958 B (S.D. Cal.). Broadcom's Opposition to Qualcomm's Demurrer to the Complaint, filed August 10, 2007, in Broadcom Corp. v. Qualcomm, Inc., No. 07-CC-01249 (California Superior Court for Orange County).

Exhibit 1:

Exhibit 2:

3.

Attached hereto as Appendix A are true and correct copies of the

following unreported cases: Alea N. Am. Ins. Co. v. Salem Masonry Co., No. 03-CV-2977, 2006 WL 3359640 (D.N.J. Nov. 20, 2006) Guale v. Rolls-Royce Engine Servs.-Oakland, Inc., No. A105370, 2005 WL 984373 (Cal. App. 1 Dist. 2005) Nokia Corp. v. Qualcomm, Inc., No. Civ. A 06-509-JJF, 2006 WL 2521328 (D. Del. Aug. 29, 2006) Tierney v. Omnicom Group Inc., No. 06-CV-14302, 2007 WL 2012412 (S.D.N.Y. July 11, 2007) Walsh v. Truck Ins. Exch. Co., No. A097316, 2003 WL 121997 (Cal. App. 1 Dist. 2003)

Dated: February 15, 2008 By: s/ William J. O'Shaughnessy William J. O'Shaughnessy -1ME1 7145490v.1

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Slip Copy Slip Copy, 2006 WL 3359640 (D.N.J.) (Cite as: Slip Copy)

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Alea North America Ins. Co. v. Salem Masonry Co., Inc. D.N.J.,2006. Only the Westlaw citation is currently available.NOT FOR PUBLICATION United States District Court,D. New Jersey. ALEA NORTH AMERICA INS. CO. Plaintiff, v. SALEM MASONRY, CO., INC., Padovano Frankel Vouga Agency, Avrin Slatkin, Covenant Broker Program, Inc., Nuno Alexandre, Granite State Insurance Co. Defendants. No. Civ.A.03-CV-2927 (PG. Nov. 20, 2006. Arthur David Bromberg, Marie Ann Hoenings, Thomas Blase Coppola, L'Abbate, Balkan, Colavita & Contini, LLP, Livingston, NJ, for Plaintiff. Carmine David Campanile, Commisa & Campanile, P.C., Livingston, NJ, Louis P. Digiaimo, Avrin Slatkin, McElroy, Deutsch, Mulvaney & Carpenter, LLP, Morristown, NJ, John D. O'Dwyer, Ginarte O'Dwyer & Winograd, Newark, NJ, Christopher H. Westrick, Golden, Rothschild, Spagnola, Lundell, Levitt & Boylan, PC, Bridgewater, NJ, for Defendants. OPINION SHERIDAN, U.S.D.J. *1 This matter comes before this Court pursuant to Fed. Civ. P. 60(b) for relief from the Court's previous orders. Defendant, Granite State Insurance Co. ("Granite"), moves to vacate the prior rulings of Judge Martini due to a change of law. I. Salem Masonry Co., Inc. ("Salem"), employed Nuno Alexandre ("Alexandre"). Salem contracted with Joseph Percario, Inc. ("Percario"), a general contractor, to perform masonry/concrete work at a worksite in Elizabeth, New Jersey. In order to per-

fect its contract with Percario, Salem was required to produce evidence that it had workers compensation insurance. To that end, Salem contracted with Alea North America Insurance Company ("Alea") to provide workers' compensation insurance. Granite provided workers' compensation insurance for Percario. On November 18, 2002, Alexandre fell down an elevator shaft which was about 5-6 stories high. Alexandre incurred catastrophic injuries requiring doctors to induce a coma for a period of time. On November 18, 2002, a claim for workers' compensation benefits on behalf of Alexandre was made to Alea. Alea commenced payment of benefits and, simultaneously, authorized an internal investigation of Salem's operations. The investigation revealed that Alexandre was working at heights more than fifteen feet above ground level. As it turns out, the application submitted on behalf of Salem indicated that employees of Salem did not perform any work at heights more than fifteen feet above ground level. Realizing Alexandre fell from a far greater height than 15 feet, Alea brought this action to rescind its policy due to fraud and to declare the general contractor's carrier, Granite, responsible to pay worker compensation benefits to Alexandre, as well as reimbursing Alea for benefits paid. Judge Martini entered several opinions prior to this case being transferred to this Court. Most noteworthy was the April 29, 2005 decision to grant summary judgement on Alea's claim of equitable fraud thereby rescinding the workers' compensation FN1 policy issued to Salem. Thereafter, the litigation grinded along with various claims being asserted against the brokers, Salem and the claim by Alea against Granite for reimbursement of monies paid to Alexandre. FN1. Despite this ruling, compensation payments to Alexandre continued because Granite was required to step up pursuant to statute.N.J.S.A. 34:15-79.

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On July 17, 2006, the unpredictable occurred. At that time, the Superior Court of New Jersey Appellate Division issued a precedential decision that held, in broad terms, that a workers' compensation carrier could not void a policy where the application by the employer contained fraudulent statements. American Millennium Insurance v. Berganza, 386 N.J.Super. 405 (App.Div.2006). The American Millennium decision gives rise to the present motion by Granite to set aside Judge Martini's decision. Granite argues that American Millennium is squarely on point with the case at hand, and this Court should defer to the decisions of law of the State of New Jersey. In order to decide the motion, a close look at the American Millennium case is required. In American Millennium, Stegers Brothers Drywall Company, Inc. ("Stegers") subcontracted drywall work to Mainor Berganza ("Berganza"), who employed Jose Arias. Id. at 488, 902 A.2d 266. On January 18, 2003, Berganza went to City Line Insurance, Inc. ("City Line"), a producer of business for Morstan General Agency of New Jersey, Inc. ("Morstan"), a wholesale broker that places workers' compensation policies with American Millennium. Id. An application and questionnaire was filled out requesting a policy with an effective date of January 19, 2003. Id. On that same date, City Line faxed a workers' compensation policy certificate to Stegers evidencing that Berganza was insured, and the application and questionnaire were forwarded to Morstan.Id. On January 20, 2003, Morstan completed the paperwork and forwarded same to American Millennium. Id. The following day, Arias was injured in a work related incident when he fell off a ladder at Stegers' worksite. Id. Berganza reported the accident to City Line on January 24, 2003. Id. On January 29 or 30, 2003, American Millennium issued a workers' compensation policy to Berganza with a retroactive effective date of January 19, 2003.Id. On February 4, 2003, City Line faxed to Morstan a "First Report of injury" which was subsequently sent by City Line directly to American Millennium on February 20, 2003. Id. at 489, 902 A.2d 266. At that point, American Millennium declined coverage and filed suit for rescission of the

policy. Id. *2 Following a bench trial which found that fraud had been committed on the application and questionnaire, the court permitted rescission as to Berganza, denied rescission as to Arias, ordered that Stegers' workers' compensation carrier be responsible for half of any compensation awarded to Arias, and allowed both carriers to seek reimbursement from Berganza. Id. at 487, 902 A.2d 266. Appeals were thereafter taken by multiple parties. Id. Ultimately, the New Jersey Appellate Division held that American Millennium was fully liable to the injured employee. Id. at 493, 902 A.2d 266. In reaching this conclusion, the court held that "[t]he contract is clear, and our statute is clear."Id. at 490, 902 A.2d 266. The court specifically cited to N.J.S.A. 34:15-83 and -84 which creates a direct relationship between the insurer and the insured's employees. The workers compensation policies must " `be construed to provide' that such policies are `made for the benefit of the several employees of the insured employer.'"Id. at 489, 492, 902 A.2d 266. The court believed this holding was "driven home" by the language of the policy which states that the insurance company is "directly and primarily liable" to injured employees, binds the insurance company to adverse decisions against the employer in compensation actions, and that "as between an injured worker and us [insurer], we have notice of the injury when you [the employer] have notice."Id. at 493, 902 A.2d 266. Since the statute creates a contractual relationship between the insurer and the employee, the court found that a "policy issued upon the untrue statements made by the employer is no defense."American Millennium 386 N.J.Super. at 490-91, 902 A.2d 266 (quoting Aiors v. Sardo, 223 A.D. 201, 227 N.Y.S. 708aff'd249 N.Y. 270, 164 N.E. 48 (N.Y.1928)).See, Bates v. Nelson, 240 Iowa 926, 38 N.W.2d 631, 635 (Ia.1949). Legal commentators agree with this proposition also. Professor Larson concurs that an insurer may only escape liability in rare circumstances. That is, in the situation where the employer attempts to find insurance

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for an employee's injuries that already occurred without disclosing the work related accident. 4 Larsons Workmen's Compensation Law § 92.22-92.24 (Bender 1986). In short, the American Millennium court found several reasons to reject recision, even if untrue statements were made by the employer or its brokers. They are (a) the statute imposes a relationship between insured and employee; (b) the employee did not commit any fraud; and (c) the statute allows the employee to directly sue the insured for coverage.American Millennium, 386 N.J.Super. at 493, 902 A.2d 266. In the case at bar, Alea argues that the American Millennium case is distinguishable and that this court is not bound to apply a decision of the Appellate Division of the Superior Court. This court rejects both arguments. First, American Millennium is closely analogous to this case. As in American Millennium, the accident occurred after the insurance certificate was forwarded, Alexandre (employee) did not commit any fraud, the statutes at issue are the same, and neither party argues that the terms of the policy are different. *3 Alea's second argument is that this Court is not bound to apply the Appellate Division's decision especially where the Supreme Court has not ruled. More particularly, Alea's brief states that the "Court is not bound by any decision of the New Jersey Appellate Division ... [and] it is unclear that the New Jersey Supreme Court would adopt the Appellate Division's holding in American Millennium."Alea's Reply Brief at Pg. 7. Although this assertion is true in the abstract, there are strong policy reasons to defer to the judgement of the Appellate Division in this instance. "When ascertaining matters of state law, the decisions of the state's highest court constitute the authoritative source. If the [state] Supreme Court has not yet passed on the question before us, we must consider the pronouncements of the lower state courts. Such decisions should be given proper regard, but not conclusive effect."Connecticut Mut. Life Ins. Co. v. Wyman, 718 F.2d 63, 65 (3d Cir.1983) (citing Commissioner v. Estate of Bosch,

387 U.S. 456, 465, 87 S.Ct. 1776, 1782, 18 L.Ed.2d 886 (1967); McKenna v. Ortho Pharmaceutical Corp., 622 F.2d 657, 662 (3d Cir.), cert. denied, 449 U.S. 976, 101 S.Ct. 387, 66 L.Ed.2d 237 (1980); Adams v. Cuyler, 592 F.2d 720, 725-26 (3d Cir.1979), aff'd, 449 U.S. 433, 101 S.Ct. 703, 66 L.Ed.2d 641 (1981)). While the federal courts are not bound by the decisions of lower state courts, "[a] decision of `an intermediate appellate state court ... is a datum for ascertaining state law which is not to be disregarded by a federal court unless it is convinced by other persuasive data that the highest court of the state would decide otherwise.'"Pittston Co. Ultramar America Ltd. v. Allianz Ins. Co., 124 F.3d 508, 516 (3d Cir.1997) (citing Dillinger v. Caterpillar, Inc., 959 F.2d 430, 435 n. 11 (3d Cir.1992)). Absent clear guidance from the New Jersey Supreme Court, federal courts must predict how the New Jersey Supreme Court would decide the issues "and will, when persuasive, rely on decisions of the intermediate appellate court, unless we are convinced that the supreme court would decide otherwise."Fleck v. KDI Sylvan Pools, Inc., 981 F.2d 107, 113 (3d Cir.1992) (citing West v. American Telephone & Tel. Co., 311 U.S. 223, 237, 61 S.Ct. 179, 183, 85 L.Ed. 139 (1940); McKenna, 622 F.2d at 662). In support of its contention, Alea relies upon the prior findings, holdings and opinions of the District Court in this case and another opinion by the District Court in In re Tri-State Armored Svc., Inc., 332 B.R. 690 (D.N.J.2005), which distinguished First American Title Ins. Co. v. Lawson, 177 N.J. 125, 827 A.2d 230 (2003), one of two cases that Granite relied heavily upon prior to American Millennium. Since "a federal court's prediction of state law, until and unless overruled by the state supreme court, tends to `verge on the lawmaking function' of the highest state court, it is critical that the federal court do all within its power to view the problem before it as a state court would, and not through the eyes of a court steeped in federal law. See Dolores K. Sloviter, A Federal Judge Views Diversity Jurisdiction Through the Lens of Federalism, 78

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Va.L.Rev. 1671, 1681-82 (1992). Accordingly, it must be recognized that a decision of a lower state court on a point of state law is generally more predictive of what the state supreme court would hold than is a conflicting opinion of a federal court on the same point."Packard v. Provident Nat. Bank, 994 F.2d 1039, 1046-47 (3d Cir.1993). *4 The language of cases out of this Circuit make clear that substantial deference is to be afforded decisions of an intermediate appellate court where the state's supreme court has not yet ruled on a particular issue. Some courts have deemed such decisions "evidence of state law," Robinson v. Jiffy Executive Limousine Co., 4 F.3d 237, 242 (3d Cir.1993), or even "presumptive evidence" of state law. National Surety Corp. v. Midland Bank, 551 F.2d 21, 30 (3d Cir.1977). Others have required "convincing," Fleck, 981 F.2d at 113, or "persuasive data that the highest court of the state would decide otherwise.' " Pittston, 124 F.3d at 516. In this instance, Judge Martini did not have the benefit of the American Millennium decision. The issue which inures is whether the opinion in American Millennium is sufficient to reopen the district court's prior decisions. "The general purpose of Rule 60(b)... is to strike a proper balance between the conflicting principles that litigation must be brought to an end and that justice must be done."Boughner v. Sec'y of Health, Educ. & Welfare, 572 F.2d 976, 977 (3d Cir.1978) (quoted in Coltec Industries, Inc. v. Hobgood, 280 F.3d 262, 271 (3d Cir.), cert. denied, 537 U.S. 947, 123 S.Ct. 411, 154 L.Ed.2d 291 (2002)). A motion filed pursuant to Rule 60(b) is "addressed to the sound discretion of the trial court guided by accepted legal principles applied in light of all the relevant circumstances."Ross v. Meagan, 638 F.2d 646, 648 (3d Cir.1981).Rule 60(b), however, "does not confer upon the district courts a `standardless residual of discretionary power to set aside judgments.'"Moolenaar v. Government of the Virgin Islands, 822 F.2d 1342, 1346 (3d Cir.1987). Rather, relief under Rule 60(b) is available only under such circumstances that the " `overriding in-

terest in the finality and repose of judgments may properly be overcome.'"Harris v. Martin, 834 F.2d 361, 364 (3d Cir.1987) (quoting Martinez-McBean v. Government of the Virgin Islands, 562 F.2d 908, 913 (3d Cir.1977))."The remedy provided by Rule 60(b) is `extraordinary, and [only] special circumstances may justify granting relief under it.'"Moolenaar, 822 F.2d at 1346 (citations omitted). Granite has appealed to the discretionary powers of the Court under Rule 60(b)(6), to modify the previous orders rescinding the policy pursuant to new case law out of the New Jersey Superior Court, Appellate Division. It is argued that American Millennium is directly on point and constitutes a legitimate and valid "reason justifying relief from the operation of the judgment."Rule 60(b)(6). The Court agrees. The rationale set forth by Judge Coburn, an experience and respected jurist, in American Millennium is sound, and most likely captures the sentiments of New Jersey's highest court if it were to hear the case. Moreover, workers' compensation laws were enacted at the turn of the twentieth century to protect workers. In exchange for limited benefits without showing negligence, workers forfeited their right to sue employers. Those laws have functioned well for both employers and employees over the last century. If the federal court were to adopt a different position than the state courts on any point of worker compensation law, the rudimentary principles underpinning workers compensation law may unravel, at least as far as it applies to the construction industry. This is not a prudent course. Hence, upsetting the "repose" of this litigation by vacating Judge Martini's decision is relatively minor compared to the potential uncertainty in workers' compensation law which arises if federal and state courts differ on substantive application of workers' compensation statutes. *5 Granite's motion for Rule 60(b) relief is granted. The previous orders of this Court are not set aside. Judgment in favor of Granite and against Alea is granted. D.N.J.,2006.

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Alea North America Ins. Co. v. Salem Masonry Co., Inc. Slip Copy, 2006 WL 3359640 (D.N.J.) END OF DOCUMENT

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Not Reported in Cal.Rptr.3d Not Reported in Cal.Rptr.3d, 2005 WL 984373 (Cal.App. 1 Dist.) (Cite as: Not Reported in Cal.Rptr.3d)

Guale v. Rolls-Royce Engine Services-Oakland, Inc. Cal.App. 1 Dist.,2005. Only the Westlaw citation is currently available. California Rules of Court, rule 8.1115, restricts citation of unpublished opinions in California courts. Court of Appeal, First District, Division 3, California. Abetu GUALE, Plaintiff and Appellant, v. ROLLS-ROYCE ENGINE SERVICES-OAKLAND, INC., Defendant and Respondent. No. A105370. (Alameda County Super. Ct. No. 2002063189). April 28, 2005. William Barnes, Oakland, CA, for Plaintiff-Appellant. Oswald Bancroft Cousins, Orrick Herrington et al LLP, San Francisco, CA, for Defendant-Respondent. PARRILLI, J. *1 Abetu Guale appeals from a judgment in favor of Rolls-Royce Engine Services-Oakland, Inc., entered after the trial court granted Rolls-Royce's motion for summary judgment on Guale's claims of fraud, negligent misrepresentation, promissory estoppel, and breach of the implied covenant of good faith and fair dealing. We affirm. BACKGROUND In August 2001, Guale was working for Chromalloy Gas Turbine Corporation as an inventory analyst. During the first week of that month, Ronald Slothower, a Chromalloy Vice President, informed Guale that he might be laid off as part of a reduction in force. According to Slothower, this was the first of at least five meetings he had with Guale where they discussed the possibility of

Guale's termination. Chromalloy employees, including Guale, were given a letter dated on or around August 6 offering them an incentive package to leave the company. Employees had 45 days to accept the package. Slothower testified at his deposition that at the end of August or the beginning of September, he met with Guale and told him that because another more senior employee had not accepted the package, Guale's employment would have to be terminated. However, Guale never accepted the incentive package. On August 10, Guale applied for an operations analyst position with Rolls-Royce. On August 27, he interviewed with Stacy Fifer, Rolls-Royce's Human Resources recruiter, and Lorne Dyke, Vice President of Flight Operations. On September 10, Dyke recommended hiring Guale, and on the same day Fifer sent Guale an offer by e-mail. Guale testified in his deposition that he did not think this offer was "legal" because it was not on a document with Rolls-Royce's company letterhead. At Guale's request, Fifer sent him a second offer on September 14 on Rolls-Royce letterhead, stating that his employment would begin on October 8, 2001. The letter noted that "all Rolls-Royce ... employees are `at will' employees."It also stated, "please indicate your acceptance of this offer by signing your name in the space provided below along with noting your anticipated start date," and told Guale to bring the letter with him on October 8. Guale admitted he did not return a signed acceptance. In his brief, Guale asserts he met with Fifer and another Rolls-Royce employee on September 18, got the impression that "a valid offer and acceptance of employment had occurred," and accordingly gave Chromalloy notice on September 19 that he would be leaving to take another job. However, these dates are not established by the record cites Guale provides. Guale did claim in his deposition testimony that he had a meeting at Rolls-Royce sometime in mid-September. But nothing in his testimony supports a September 19 resignation from Chromalloy; to the contrary, Guale said he

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could remember nothing about giving notice. Instead, he testified that sometime in that last two weeks of September he mutually agreed with Slothower that he would work at Chromalloy until September 28. *2 On the afternoon of September 20, Peter Caldwell, the Senior Manager of Human Resources for Rolls-Royce, left a phone message asking Guale to call him. When Guale came home from work that evening, he called Caldwell and learned RollsRoyce was withdrawing its offer of employment. Caldwell told Guale that September 11 had changed the situation in the airline industry, and that the salary he had been offered was too high. Caldwell offered Guale the opportunity to interview for a different position as a scheduler, which Guale accepted. On September 25, Slothower gave Guale a letter informing him that his employment at Chromalloy was terminated effective September 28, and that he would receive three months' severance pay. Slothower testified that Guale had no choice in the matter; he would not under any circumstances have been employed at Chromalloy after September 28. On September 30, 2001, Guale successfully applied for unemployment insurance, stating "laid off" as his reason for separation from Chromalloy. On October 1, Guale interviewed for the scheduler position at Rolls-Royce. He did not impress his interviewers and they declined to extend an offer to him. Caldwell sent Guale a letter informing him that Rolls-Royce had no further positions for him. In August 2002, Guale filed his complaint in this action. In granting Rolls-Royce's motion for summary judgment, the trial court ruled: (1) Guale could not prevail on his fraud, negligent misrepresentation, and promissory estoppel claims because the undisputed evidence established that Rolls Royce's offers of employment were not made with the intent to deceive, and Guale did not rely on these offers to his detriment; (2) the promissory estoppel claim failed because the undisputed evidence established that

Guale did not detrimentally rely on the offer and suffered no unconscionable injury; and (3) Guale could not recover for breach of the implied covenant of good faith and fair dealing because the undisputed evidence established that Rolls-Royce's offer was expressly for at-will employment. DISCUSSION Summary judgment is properly granted when the papers show there is no triable issue of material fact and the moving party is entitled to judgment as a matter of law. (Code Civ. Proc., § 437c, subd. (c).) We review the trial court's decision de novo, considering all of the evidence the parties offered in connection with the motion and the uncontradicted inferences the evidence reasonably supports. (Artiglio v. Corning Inc. (1998) 18 Cal.4th 604, 612.)Once a moving defendant has shown that one or more elements of the cause of action, even if not separately pleaded, cannot be established, or that there is a complete defense, the burden shifts to the plaintiff to show the existence of a triable issue. To meet that burden, the plaintiff may not rely upon the mere allegations or denials of its pleadings, but must set forth the specific facts showing a triable issue of material fact. (Code Civ. Proc., § 437c, subd. (o)(2); see Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 854-855;Merrill v. Navegar, Inc. (2001) 26 Cal.4th 465, 476-477.) 1. Guale Failed To Show Detrimental Reliance *3 It is well established that reliance damages are necessary elements of claims for fraud and negligent misrepresentation. (Lazar v. Superior Court (1996) 12 Cal.4th 631, 638 [fraud]; Fox v. Pollack (1986) 181 Cal.App.3d 954, 962 [negligent misrepresentation]; Cal. Civ.Code § 1709.) Similarly, detrimental reliance is an essential element of promissory estoppel. (Smith v. City & County of San Francisco (1990) 225 Cal.App.3d 38, 48; see also Toscano v. Greene Music (2004) 124 Cal.App.4th 685, 694 [reliance damages on promissory estoppel claim "must not be speculative, remote, contingent, or merely possible"].)

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We agree with the trial court's ruling that Guale could not prevail on his fraud, negligent misrepresentation, and promissory estoppel causes of action because he failed to show a triable issue of fact regarding his detrimental reliance on Rolls-Royce's offer of employment. This is not a case of "factually devoid discovery," as Guale contends in his briefs. (See, e.g., Scheiding v. Dinwiddie Construction Co. (1999) 69 Cal.App.4th 64, 81-83.)Rather, the facts as developed by both parties affirmatively showed that Guale suffered no damages in reliance on Rolls-Royce's employment offer. His employment at Chromalloy was terminated whether or not Rolls-Royce withdrew its offer. Guale simply cannot show any damages, even under the circumstances as he interprets them in his briefs. Guale claims he resigned from Chromalloy on September 19, intending to go to work for RollsRoyce, but then came to a mutual agreement with Slothower to characterize his separation from Chromalloy as a lay-off after the Rolls-Royce offer was withdrawn. This scenario, however, does not include any damage to Guale flowing from the withdrawal of the Rolls-Royce offer. Slothower's testimony that Guale would never have been employed by Chromalloy after September 28 was uncontradicted. Guale states in his brief that "he might well have been able to work out more favorable terms (perhaps including some continuing employment) had he not, prior to being given notice of any layoff, resigned his position with Chromalloy."Absolutely no evidence supports this speculation. Guale himself mentioned no such possibility of more favorable terms in the deposition testimony he cites in his brief. Guale also suggests that Rolls-Royce's actions deprived him of the opportunity to take the incentive package offered by Chromalloy to departing employees, which may have been more favorable than the severance package Guale ultimately received. He notes the 45-day window for accepting the incentive package expired on September 20. If, however, Guale resigned on the 19th, as he claims in his briefs, he would still have been able to take

advantage of the incentive package. Indeed, regardless of his claimed resignation date, if Guale were relying on Rolls-Royce's offer from the time it was made on September 14 until it was withdrawn at the end of the day on September 20, he had nearly a week during which he could have taken advantage FN1 of the incentive package. His failure to do so cannot be blamed on Rolls-Royce. FN1. In his brief, Guale claims the offer was withdrawn on September 22. The evidence does not substantiate that date. Guale testified he got the phone call from Caldwell withdrawing the offer "on or about September 20." Even if that testimony can be stretched to include September 22, Guale had ample opportunity to accept the incentive package if he was relying on the Rolls-Royce offer. *4 Rolls-Royce's showing of the circumstances in which Guale's employment with Chromalloy ended was sufficient to shift to Guale the burden of showing a triable issue on the existence of damages or detrimental reliance. Guale did not meet that burden. 2. Guale Could Not Recover for Breach of the Implied Covenant Guale contends the court erred when it ruled that the at-will nature of the employment offered by Rolls-Royce precluded any recovery for breach of the covenant of good faith and fair dealing. He does not dispute that the Rolls-Royce job would have been at will. He argues that an at-will employee who is never permitted to commence promised employment is in a different position than an at-will employee who has begun working. To support that proposition under California law, Guale relies on two cases, Sheppard v. Morgan Keegan & Co. (1990) 218 Cal.App.3d 61, and Comeaux v. Brown & Williamson Tobacco Co. (9th Cir.1990) 915 F.2d 1264 (applying California law). Both cases, however, are distinguishable. In Sheppard, the plaintiff accepted an oral offer

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of employment from the defendant, and moved from California to Tennessee only to be "separated" from his new job before it began. (Sheppard v. Morgan Keegan & Co., supra, 218 Cal.App.3d at pp. 64-65.)The court reasoned that the implied covenant of good faith and fair dealing included "the understanding that an employer cannot expect a new employee to sever his former employment and move across the country only to be terminated before the ink dries on his new lease, or before he has had a chance to demonstrate his ability to satisfy the requirements of the job."(Id. at p. 67.)Here, as noted in the first part of our discussion, Guale was unable to show any detrimental reliance on the Rolls-Royce offer. Furthermore, unlike Sheppard, he never accepted the offer from his prospective new employer. His attempts to argue around the requirement of written acceptance stated in the September 14 letter are unconvincing. In Comeaux, the plaintiff signed an application providing that his contract would begin when he was assigned work, and that his employment would be at-will. (Comeaux v. Brown & Williamson Tobacco Co., supra, 915 F.2d at pp. 1269-1270.)Subsequent oral discussions between the parties established additional terms, according to the court that if Comeaux passed a physical examination, resigned his current job, and moved to Fremont within a specified time, he would be assigned work. (Id. at p. 1270.)Comeaux satisfied those conditions but the defendant refused to assign him any work. The court decided the parties never reached the point where the written at-will provisions would begin to govern the employment, and permitted him to seek contract damages. However, the court held that Comeaux could recover only reliance damages under California law. (Id. at pp. 1271-1272.) The court also ruled that "Comeaux cannot use the covenant of good faith and fair dealing to transform a terminable-at-will employment contract into a terminable-only-for-cause employment contract by construing a discharge without cause as a breach of the covenant."(Id. at p. 1272.)Therefore, the court held that any recovery for breach of the covenant of good faith and fair dealing would also be

limited to reliance damages. (Ibid.) Guale, lacking any reliance damages, is in no position to take advantage of the Comeaux holding. Furthermore, nothing in this case suggests the at-will character of Guale's prospective employment would not begin until he started working, as was the situation in Comeaux. *5 We conclude the trial court properly ruled that the at-will character of Guale's prospective employment at Rolls-Royce precluded any recovery for breach of the covenant of good faith and fair dealing. Even if Guale could show that a contract was formed by his acceptance of Rolls-Royce's offer, he would be limited to reliance damages under the reasoning of Comeaux.The Sheppard court also emphasized the plaintiff's detrimental reliance. If Guale could have been fired by Rolls-Royce after one day for purely arbitrary reasons (Guz v. Bechtel National, Inc. (2000) 24 Cal.4th 317, 350), we fail to see how Rolls-Royce's withdrawal of an unaccepted offer could entitle Guale to pursue a claim of breach of the implied covenant of good faith and fair dealing, absent any evidence of detrimental reFN2 liance. FN2. As our discussion indicates, a more fundamental reason for granting summary judgment on this cause of action was the absence of any accepted offer, which prevented the implied covenant of good faith and fair dealing from arising in the first place. The Guz court emphasized the obvious and settled point of law that the implied covenant has no existence independent of the contract. (Guz v. Bechtel Nat., Inc., supra, 24 Cal.4th at p. 349-350.)Nevertheless, because the trial court did not rely on this ground, we refrain from basing our holding on it. (See Code Civ. Proc., § 437c(m)(2).) DISPOSITION The judgment is affirmed. Rolls-Royce shall recover its costs on appeal. We concur: McGUINESS, P.J., and CORRIGAN, J.

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Cal.App. 1 Dist.,2005. Guale v. Rolls-Royce Engine Services-Oakland, Inc. Not Reported in Cal.Rptr.3d, 2005 WL 984373 (Cal.App. 1 Dist.) END OF DOCUMENT

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Not Reported in F.Supp.2d Not Reported in F.Supp.2d, 2006 WL 2521328 (D.Del.) (Cite as: Not Reported in F.Supp.2d)

Nokia Corp. v. Qualcomm, Inc. D.Del.,2006. Only the Westlaw citation is currently available. United States District Court,D. Delaware. NOKIA CORP. and Nokia, Inc., Plaintiffs, v. QUALCOMM, INC. Defendant. No. CIV A 06-509-JJF. Aug. 29, 2006. A. William Urquhart, Frederick Lorig, Patrick Shields, and Erica Taggart, of Quinn Emanuel Urquhart Oliver & Hedges, L.L.P., Los Angeles, California, Richard I. Werder, Jr., and Sanford I. Weisburst, of Quinn Emanuel Urquhart Oliver & Hedges, L.L.P., New York, New York, Thomas A. Beck, Lisa A. Schmidt, Jeffrey L. Moyer, and Steven J. Fineman, of Richards, Layton & Finger, P.A., Wilmington, Delaware, for Plaintiffs. Evan R. Chesler, and Richard J. Stark, of Cravath, Swaine & Moore, L.L.P., New York, New York, Richard L. Horwitz, Mathew E. Fischer, and Kenneth L. Dorsney, of Potter Anderson & Corroon, L.L.P ., Wilmington, Delaware, for Defendant. MEMORANDUM OPINION FARNAN, J. *1 Pending before the Court is Plaintiff's Motion to Remand (D.I.5). For the reasons discussed, the Court will grant Plaintiff's Motion to Remand. I. BACKGROUND Plaintiff Nokia filed suit in the Court of Chancery of the State of Delaware seeking declaratory relief and specific performance to enforce terms of alleged contracts existing between it and Defendant Qualcomm. (See D.I. 6, Ex. B). The contractual agreements at issue relate to the standard-setting procedures of the European Telecommunications Standardization Institute ("ETSI") regarding the licensing of essential patents. Defendant filed a No-

tice of Removal contending that patent law is a necessary element of Plaintiff's claims. (D.I.1). II. DISCUSSION The issue presented by the parties is whether Plaintiff's claim "arises under" federal patent law pursuant to 28 U.S.C. § 1338(a) such that this Court may exercise its jurisdiction. A claim arises under patent law when plaintiff's well-pleaded complaint establishes a cause of action based on patent law.Christianson v. Colt Indus. Operating Corp., 486 U.S. 800, 809 (1988). However, even if the complaint establishes no patent law claim on its face, federal jurisdiction is proper where "the plaintiff's right to relief necessarily depends on resolution of a substantial question of patent law, in that patent law is a necessary element of one of the well-pleaded claims."Id. Because Plaintiff's complaint cites no claims of patent infringement, invalidity, or unenforceability on its face, the predominate issue is whether patent law is a necessary element of Plaintiff's claims. Plaintiff's complaint is based on an alleged breach of contractual agreements surrounding Defendant's licensing of essential patents. However, a clever plaintiff cannot avoid federal jurisdiction simply by failing to plead patent law issues. Id. at n. 3. Thus, it is necessary to determine whether resolution of Plaintiff's claims depends on a "substantial question of patent law." In U.S. Valves, Inc. v. Dray, 212 F.3d 1368, 1372 (Fed.Cir.2000), the Federal Circuit found a "substantial question of patent law" where it was necessary for the court to interpret patents and determine whether infringement occurred. In U.S. Valves, plaintiff alleged that defendant sold valves which infringed its patents in violation of a license agreement. Id. Thus, interpretation of the patents was integral to resolution of the suit. Id. Similarly, in Highland Supply Co. v. Klerk's Flexible Packaging, B.V., a case cited by Defendant, the court found patent law was necessary to resolve a breach

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of contract claim where plaintiffs had to prove the products in question were covered by its patent. No. 05-482, 2005 WL 3534211, at *4 (S.D.Ill.Dec. 21, 2005). In addition, the court had to conduct a "fact-intensive and technical inquiry" to determine whether the patent was, in fact, infringed. Id. In contrast, the present case involves interpretation of the terms of the licensing agreement between Plaintiff and Defendant which arises from Defendant's use of the ETSI procedures to declare certain patents "essential." It is not necessary, as Defendant contends, to determine whether the patents at issue are in fact "essential" because Defendant has already voluntarily declared them essential. Rather, Plaintiff merely seeks an interpretation of Defendant's obligations arising after declaring certain patents essential. *2 The ETSI IPR Database states that declared patents include "an undertaking from the owner to grant licenses."(D.I.14, Ex. 6). These licenses are to be granted to ETSI members on terms that are fair, reasonable, and non-discriminatory ("FRAND terms"). (D.I.6, p. 3). For Defendant to now contend Plaintiff's claims cannot be resolved without determining whether the patents at issue are essential seems incongruent with Defendant's own declarations to the ETSI. Although the ETSI IPR Database includes a disclaimer that it "cannot confirm, or deny, that the patents/patent applications [contained therein], are, in fact, essential, or potentially essential," (D.I.14, Ex. 6), such a determination is not necessary to the interpretation of the parties' contractual obligations for declared-essential patents. SeeUnited Techs. Corp. v. Chrome Alloy Gas Turbine Corp., 105 F.Supp.2d 346, 358 (D.Del.2000) (finding no question of patent law where interpretation of patents was not necessary to determine breach of the licensing agreement). In sum, Plaintiff seeks a determination by the Court of Chancery of the terms of the contractual agreements undertaken by Defendant as a result of declaring certain patents essential. In addition, Plaintiff seeks declaratory relief and specific performance to enforce those obligations. In the

Court's view, resolution of this claim depends on interpretation of the terms of the licensing agreement, rather than interpretation of the patents. Accordingly, the Court concludes that there is no substantial question of patent law warranting federal jurisdiction, and therefore, Plaintiff's Motion to Remand will be granted. III. CONCLUSION For the reasons discussed, the Court will grant Plaintiff's Motion to Remand (D.I.5). An appropriate Order will be entered. ORDER At Wilmington, this 29th day of August 2006, for the reasons set forth in the Memorandum Opinion issued this date, IT IS HEREBY ORDERED that Defendants' Motion To Remand (D.I.5) is GRANTED. D.Del.,2006. Nokia Corp. v. Qualcomm, Inc. Not Reported in F.Supp.2d, 2006 WL 2521328 (D.Del.) END OF DOCUMENT

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Tierney v. Omnicom Group Inc. S.D.N.Y.,2007. Only the Westlaw citation is currently available. United States District Court,S.D. New York. Michael P. TIERNEY, Plaintiff, v. OMNICOM GROUP INC., Defendant. No. 06 Civ. 14302(LTS)(THK). July 11, 2007. MEMORANDUM ORDER LAURA TAYLOR SWAIN, United States District Judge. *1 In this action brought against Defendant Omnicom Group Inc., Plaintiff Michael P. Tierney, in his Amended Complaint, raises several causes of action under New York common law concerning stock options that Omnicom allegedly promised to him. The Court has diversity jurisdiction of this action pursuant to 28 U.S.C. § 1332. Defendant now moves pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure to dismiss Plaintiff's Amended Complaint in its entirety. The Court has thoroughly considered all of the parties' submissions and written and oral arguments. For the following reasons, Defendant's motion is granted in part and denied in part. BACKGROUND The following facts, alleged in Plaintiff's Amended Complaint, are taken as true for the purposes of the instant motion practice. Bernheim v. Litt, 79 F.3d 318, 321 (2d Cir.1996). In mid-2000, Defendant Omnicom Group Inc. ("Omnicom" or "Defendant"), through its Chief Executive Officer John Wren, asked Plaintiff Michael P. Tierney ("Tierney" or "Plaintiff") to manage some of Omnicom's investments in digital marketing companies (the "digital investments") as President of Communicade Management Company

("Communicade"), an Omnicom subsidiary responsible for managing those investments. (Am.Compl.¶¶ 9-14.) On July 17, 2000, Wren and Tierney executed a term sheet (the "Employment Agreement") (id. ¶ 12) which provided, inter alia, that Tierney would become the President of Communicade and manage Omnicom's digital investments for a $450,000 base annual salary and stock options. The term of employment was fixed at three years. With regard to the stock options, the Employment Agreement stated: "Stock Options: Initial award upon joining of 10,000 shares; shares vest over three years. Additional awards based on performance ."(Id. Ex. A.) Tierney commenced his work on October 1, 2000.(Id. ¶ 16.) Omnicom thereafter executed three separate stock option agreements (the "Stock Option Agreements") FN1 with Tierney. (Am.Compl.¶¶ 16-19.) On October 2, 2000, Omnicom executed a Stock Option Agreement granting Tierney an option to purchase 10,000 shares at $73,625 per share. (Declaration of Christopher R. Harris in Supp. of Def.'s Mot. to Dismiss ("Harris Decl.") Ex. 1.) On February 2, 2001, Omnicom executed a Stock Option Agreement granting Tierney an option to purchase 15,000 shares at $87,160 per share. (Id. Ex. 2.) On April 4, 2001, Omnicom executed a Stock Option Agreement granting Tierney an option to purchase 15,000 shares at $79,500 per share. (Id. Ex. 3.) Aside from the grant date, the number of shares, and the strike price, these Stock Option Agreements contained FN2 identical terms. FN1. Although copies of the Stock Option Agreements were proffered by Defendant rather than Plaintiff, the Court may refer to these documents at the motion to dismiss stage because they are integral to Plaintiffs pleadings, I. Meyer Pincus & Assocs. v. Oppenheimer & Co., 936 F.2d 759, 762 (2d Cir.1991), and Plaintiff does not challenge their authenticity. FN2. Exhibits 1, 2 and 3 to Defendant's Notice of Motion to Dismiss, which are reproductions of the three Stock Option Agreements, are

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hereinafter referenced to collectively as the "Stock Option Agreements." The Stock Option Agreements each provided that in the event of "Involuntary Termination of Employment" FN3 following the first anniversary of the stock option's grant date, the stock options would remain exercisable by Tierney for 36 months (three years) following the termination. (Stock Option Agreements § 3(b)(i).) However, in the event of Tierney's voluntary termination of his employment, the stock options would be cancelled immediately. (Id . § 3(b).) The Stock Option Agreements defined "Termination of Employment" as the time "when the employee-employer relationship between the Employee and Omnicom or an Omnicom Subsidiary ceases to exist for any reason ...." (Id. § 6(a).) "Omnicom Subsidiary" was defined in the Omnicom Group Inc.1998 Incentive Compensation Plan (explicitly incorporated by the Stock Option Agreements at § 1), as including "any entity that is organized as a limited liability company in which [Omnicom], directly or indirectly, possesses 50% or more of the voting power of all members of such limited liability company entitled to vote." (Harris Decl. Ex. 4 § 2(t).) FN3. "Involuntary Termination of Employment" meant a "Termination of Employment for a reason other than death, Retirement, Total Disability, voluntary resignation, or Termination of Employment for Cause."(Stock Option Agreements § 6(d).) *2 The value of Communicade and its digital investments began to decline dramatically. As a result, Omnicom decided to form a limited liability company called Seneca Investments LLC ("Seneca"), which would take over the management of the digital investments. (Am.Compl.¶¶ 20-22.) In January 2001, Omnicom and Tierney began a series of oral exchanges in which both parties reaffirmed their commitments to the terms of the Employment Agreement but also introduced some modifications reflecting more recent developments (the "Oral Modifications"). Omnicom repeatedly asked Tierney to carry out the "responsibilities specified in the [Employment] Agreement," but, in light of Omnicom's plan to save the digital investments through the creation of Seneca, Tierney was to continue

his responsibilities as the eventual CEO of Seneca. (Id. ¶ 27-28, 177.)Omnicom assured Tierney that the "compensation terms specified under the [Employment] Agreement remained in effect"(Id. ¶ 30), but in acknowledgment of the specific stock option grants that had been made by that time, Omnicom also assured Tierney that "it would take any steps necessary to ensure that the [stock options] remained exercisable by [Tierney], FN4 or that it would provide [Tierney] their value." (Id. ¶¶ 30-31.)Omnicom did not sign a new employment agreement with Tierney concerning his transfer to FN5 Seneca. (Id. ¶ 41.)On or about May 1, 2001, Omnicom and two other entities, Pegasus E-Services Holdings LLC and Pegasus Partners II, L.P., executed an agreement to create Seneca ("Seneca Formation AgreeFN6 ment"). (Harris Decl. Ex. 5.) The agreement contained a Schedule 3.7 concerning the terms under which Tierney and certain others would be employed by Seneca. (Id.) FN4. At oral argument, Plaintiff's counsel proffered that, under the alleged agreement to provide the value of the stock, Omnicom was to pay Plaintiff the value of the stock as of the time of the Seneca transition, calculated under the "Black-Scholes" valuation formula, in accordance with the eligibility and payment terms set forth in the Stock Option Agreements. (Oral Argument Tr. 15-16.) FN5. Plaintiff cites May 1, 2001, as Seneca's creation date and Plaintiff's commencement date at Seneca. (Am.Compl.¶¶ 94, 122, 172, 191, 227.) However, the Seneca Formation Agreement and the Seneca Charter (Harris Decl. Ex. 5, 6), which are proffered by Defendant, explicitly refer to Seneca's creation date as being May 2, 2001. The Court construes Plaintiff's allegations as true at this stage of litigation, the discrepancy is not material to this order's analysis, and Defendant has not argued that the Seneca Formation Agreement and the Seneca Charter are "integral to" Plaintiff's Amended Complaint. See I. Meyer Pincus & Assocs. v. Oppenheimer & Co., 936 F.2d 759, 762 (2d Cir.1991) (construing the terms of a document proffered by the defendant as part of

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the plaintiff's complaint upon a motion to dismiss because it was "integral to" the complaint). For these reasons, and also for the sake of simplicity, the Court will refer to Seneca's creation date as being May 1, 2001. FN6. Technically, the Seneca Formation Agreement first creates an LLC called "Pegasus E-Services Investments LLC." That entity was to then be renamed "Seneca Investments LLC" promptly after closing. (Harris Decl. Ex. 5 § I.l.l.) Seneca had two classes of stock: non-voting preferred stock and common stock, which had voting rights. (Harris Decl. Ex. 6 § 6(b).) Although Omnicom owned all of the non-voting preferred stock at all relevant times (Am.Compl.¶ 119), Omnicom decided which entities would hold the common stock from May 1, 2001, to March 31, 2004. At some point before June 2002, Omnicom paid an entity, Pegasus Ventures, $6,000,000 in "management fees" to hold the Seneca common stock and serve as Omnicom's agent with respect to Seneca. (Id. ¶¶ 120-28.)After Pegasus Ventures acquired Seneca's common stock, Omnicom played an active role in managing transactions involving Agency.com, Organic, and Live Web, which turned out to be Seneca's most financially significant investments. Omnicom prepared all the term sheets and legal documentation, and it handled all substantive negotiations concerning these transactions. Meanwhile, Pegasus Ventures, the entity that held 100% of the voting stock of Seneca, had no involvement in these transactions whatsoever. (Id. ¶¶ 172-80.) In June of 2002, Pegasus Ventures surrendered its common shares in Seneca and, for a period of time, Omnicom was Seneca's only shareholder. Omnicom then agreed to pay a company called Chaucer an unspecified amount of "management fees" to hold Seneca's common stock and serve as Omnicom's agent with respect to Seneca. Omnicom thereafter cancelled the agreement with Chaucer, resuming its role as Seneca's only shareholder. (Am.Compl.¶¶ 130-34.) There was no express provision in the Seneca Formation Agreement or the Seneca Charter concerning voting rights when the only shareholder of Seneca held only non-voting, pre-

ferred stock. (See Harris Decl. Ex. 5, 6.) *3 In the second half of 2002, Omnicom paid Tierney and Jerry Neumann, the Chief Financial Officer of Seneca and Communicade, a "bonus" of $250,000 so that they could purchase Seneca's common shares, which were valued at $250,000 at that time. (Id. ¶¶ 135-36.) Tierney and Neumann formed a company called PGNT Management LLC ("PGNT"), with Tierney as the majority shareholder, to acquire Seneca's common shares. As the majority shareholder of PGNT, which in turn was the sole owner of Seneca's common shares, Tierney did not allow PGNT to take any actions with respect to Seneca of which Omnicom did not approve. (Id. ¶¶ 139-45.)On March 31, 2004, Omnicom converted its preferred stock in Seneca into a $24,000,000 Note and 40% of Seneca's common equity, then transferred the 40% equity interest to Wharton Business School. (Id. ¶¶ 218-22.) The three-year term specified in the Employment Agreement between Omnicom and Tierney expired on October 1, 2003. (Am.Compl.¶ 74.) At a time unspecified in the Amended Complaint, Omnicom told Tierney that it would not renew the Employment Agreement because Tierney's continued work for Omnicom in any capacity would hurt Omnicom's position in a separate securities litigation.(Id. ¶¶ 73, 75.)Nonetheless, Omnicom continued paying Tierney the same salary and provided him the same benefits as had been provided prior to the formation of Seneca until March 31, 2004 (Id. ¶ 63), when Omnicom and Tierney's employer-employee relationship finally ended. (Id. ¶ 109.) On November 8, 2006, Tierney sent a notice to Omnicom formally exercising the October 2, 2000, and February 2, 2001, stock options and, on January 23, 2007, Tierney sent a notice to Omnicom formally exercising the April 4, 2001, stock options. Omnicom refused to recognize Tierney's attempts to exercise the options or pay their cashless exercise value. (Id. ¶¶ 97-106.) Plaintiff asserts ten causes of action arising under New York common law, including multiple breach of contract claims, multiple claims of breach of the im-

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plied covenant of good faith and fair dealing, and claims of quantum meruit, unjust enrichment, and promissory estoppel. Plaintiff additionally invokes the doctrines of waiver, estoppel, unclean hands, and specific performance as causes of action. DISCUSSION In evaluating a motion to dismiss a pleading pursuant to Rule 12(b)(6), the Court must take as true the facts alleged in the claimant's pleading and draw all reasonable inferences in his favor. W. Mohegan Tribe & Nation v. Orange County, 395 F.3d 18, 20 (2d Cir.2004); Hernandez v. Coughlin, 18 F.3d 133, 136 (2d Cir.1994). The recent U.S. Supreme Court decision in Bell Atlantic Co. v. Twombly, 127 S.Ct. 1955 (2007), and a Second Circuit decision, Iqbal v. Hasty, No. 05-5768-CV (L), 2007 WL 1717803 (2d Cir. June 14, 2007), which interprets and applies Twombly, indicate that, at least where the facts alleged in the challenged pleading are ambiguous as to whether the conduct alleged is sufficient to warrant a finding of culpability, the determination as to whether a pleading articulates facts sufficient to state a claim upon which relief may be granted includes an assessment as to whether sufficient facts are alleged to make the plaintiff's allegations of wrongdoing "plausible." Whether Plaintiff's Allegations are "Well-Pleaded" or "Plausible" *4 Defendant argues that the entire Amended Complaint should be dismissed because it is not "well-pleaded." While a court must deem the plaintiff's allegations to be true on a motion to dismiss, "the standard to govern the sufficiency of the complaint presumes `well-pleaded' allegations, and it is only those pleadings the courts are charged to deem true."Rieger v. Drabinsky, 151 F.Supp.2d 371, 405 (S.D.N.Y.2001). Thus, a court need not feel constrained to accept as truth conflicting pleadings that make no sense, or that would render a claim incoherent, or that are contradicted either by statements in the complaint itself or by documents upon which its pleadings rely, or by facts of which the court may take judicial notice.

Id. at 405-06.Rule 201(b) of the Federal Rules of Evidence provides that "[a] judicially noticed fact must be one not subject to reasonable dispute in that it is either (1) generally known within the territorial jurisdiction of the trial court or (2) capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned."A court may take judicial notice of public records in deciding a motion to dismiss. See, e.g., Blue Tree Hotel Inv. (Can.), Ltd. v. Starwood Hotels & Resorts Worldwide, Inc., 369 F.3d 212, 217 (2d Cir.2004); Kramer v. Time Warner, Inc., 937 F.2d 767, 774 (2d Cir.1991) ("[t]he practice of taking judicial notice of public documents is not new"). Defendant argues the Court should take judicial notice of certain prior statements by Plaintiff that are reflected in publicly-filed documents. These prior statements purportedly establish that Plaintiff's employment relationship with Omnicom ceased in May 2001. (See Harris Decl. Ex. 8-10.) Defendant argues that Plaintiff's allegations that he worked for Omnicom until March 31, 2004, are not "well-pleaded" because they are contradicted by these earlier statements. Prior inconsistent statements, while material to credibility, are not the proper subject matter of judicial notice. Furthermore, given Plaintiff's allegations of an overall corporate strategy of keeping the Seneca business "off the books" as far as Omnicom was concerned, and his specific allegations regarding disguised agency arrangements relating to voting power, statements he made while acting as president of Seneca would not at this stage be an appropriate basis for making a definitive finding as to the nature or status of his relationship to the Omnicom group at this stage of the litigation. Defendant further argues that Plaintiff's allegations that he worked for Omnicom until March 31, 2004, are not "well-pleaded" because they are also contradicted by other allegations in Plaintiff's own complaint. See Hirsch v. Arthur Andersen & Co., 72 F.3d 1085, 1095 (2d Cir.1995) (affirming dismissal of complaint where "attenuated allegations" supporting a claim were "contradicted by more specific allegations in the complaint"); Rieger v. Dabrinsky. 151 F.Supp.2d 371, 405 (S.D.N.Y.2001) ("a court need not feel constrained to accept as truth conflicting pleadings that ... are contra-

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dicted ... by statements in the complaint itself"). Defendant argues that allegations in the Amended Complaint which describe Pl