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Cruz v. HSBC

July 26, 2010


The opinion of the court was delivered by: Simandle, District Judge



Plaintiff, Christian Cruz, brought this action for defamation and wrongful discharge against Defendant HSBC Finance Corporation ("HSBC") and Defendant Mowles (collectively as "Defendants.") (Notice of Removal ¶ 1.) Presently this matter is before the Court on Defendants' motions to dismiss both counts for failure to state a claim pursuant to Rule 12(b)(6), Fed. R. Civ. P. [Docket Items 3 & 10].*fn1 As will be explained at length below, the Court finds that Plaintiff has stated a prima facie case for defamation but has failed to state a claim for wrongful discharge. The Court will dismiss Count II for wrongful discharge without prejudice to Plaintiff's opportunity to request leave to file a curative amendment to provide a plausible basis for his claim. Defendants' motions will be denied for Count I.


The following facts comprise the sum of facts alleged in the Complaint. Mr. Cruz was employed by HSBC for seven years. (Compl. Count I ¶ 1, Notice of Removal, Ex. A.) HSBC allowed its employees personal use of the Internet while at work so long as it "did not interfere with their work, the work of other employees, or the operation of the Company's resources." (Id. ¶ 2.) At some point in time,*fn2 Mr. Cruz purchased a small gift for his daughter during work hours. (Id. ¶ 3.) Sometime after this purchase Mr. Mowles, a management supervisor for HSBC, accused Mr. Cruz of "improper computer usage" without proof of any impropriety. (Id. ¶¶ 4, 6.) This accusation was communicated to other employees and management at HSBC and as a result Mr. Cruz was fired and has suffered emotional distress, financial loss, and loss of work benefits. (Id. ¶ 4.) Mr. Cruz asserts that the accusation was false and HSBC and Mr. Mowles failed to reasonably investigate or substantiate the veracity of the claim. (Id. ¶¶ 5-6.)

On or about October 6, 2009,*fn3 Mr. Cruz brought this action in the Law Division of the Superior Court of New Jersey, Atlantic County. (Notice of Removal ¶ 1.) Defendant HSBC subsequently removed the action to this Court based on diversity jurisdiction under 18 U.S.C. § 1332.*fn4 (Id. ¶ 5.)

On February 1, 2010, Defendant HSBC filed the instant motion to dismiss. [Docket Item 3.] On April 28, 2010, Defendant Mowles filed a motion to dismiss which wholly relied upon HSBC's briefs. [Docket Item 10.] Briefing on both motions is now complete and they are ripe for a decision.


A. Standard for Motion to Dismiss

In deciding the Defendants' motions to dismiss pursuant to Rule 12(b)(6), the Court must "accept all factual allegations as true, construe the complaint in the light most favorable to the plaintiff, and determine whether, under any reasonable reading of the complaint, the plaintiff may be entitled to relief." Phillips v. County of Allegheny, 515 F.3d 224, 231 (3d Cir. 2008) (quoting Pinker v. Roche Holdings Ltd., 292 F.3d 361, 374 n.7 (3d Cir. 2002)). Thus, "to survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, --- U.S. ---, 129 S. Ct 1937, 1949 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)); Fowler v. UPMC Shadyside, 578 F.3d 203, 210 (3d Cir. 2009).

"While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the 'grounds' of his 'entitle[ment] to relief' requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Twombly, 550 U.S. at 555 (2007) (quoting Papasan v. Allain, 478 U.S. 265, 286 (1986)).

Therefore, after Iqbal, when presented with a motion to dismiss for failure to state a claim, district courts should conduct a two-part analysis. First, the factual and legal elements of a claim should be separated. The District Court must accept all of the complaint's well-pleaded facts as true, but may disregard any legal conclusions. Second, a District Court must then determine whether the facts alleged in the complaint are sufficient to show that the plaintiff has a "plausible claim for relief." In other words, a complaint must do more than allege the plaintiff's entitlement to relief. A complaint has to "show" such an entitlement with its facts.

Fowler, 578 F.3d at 210-11 (citations omitted).

The court will thus look at each count separately determining what would be required for a plausible case then deciding whether the alleged facts are ...

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