15-3104

Goldberg v. Jacquet

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED

ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE

PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A

DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN

ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST

SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

1 At a stated term of the United States Court of Appeals

2 for the Second Circuit, held at the Thurgood Marshall United

3 States Courthouse, 40 Foley Square, in the City of New York,

on the 30th 4 day of June, two thousand sixteen.

5

6 PRESENT: DENNIS JACOBS,

7 GUIDO CALABRESI,

8 REENA RAGGI,

9 Circuit Judges.

10

11 - - - - - - - - - - - - - - - - - - - -X

12 MARC GOLDBERG, 

13 Plaintiff-Appellant,

14

15 -v.- 15-3104

16

17 ERNEST K. JACQUET, 

18 Defendant-Appellee.

19 - - - - - - - - - - - - - - - - - - - -X

20

21 FOR APPELLANT: ARIEL Y. GRAFF, The Ottinger

22 Firm, P.C., New York, New York.

23

24 FOR APPELLEE: HARLAN M. LAZARUS, Lazarus &

25 Lazarus, P.C., New York, New

26 York.

27

1
1 Appeal from a judgment of the United States District

2 Court for the Southern District of New York (Crotty, J.).

3

4 UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED

5 AND DECREED that the judgment of the district court be

6 AFFIRMED. 

7

8 Plaintiff Marc Goldberg appeals from the judgment of

9 the United States District Court for the Southern District

10 of New York (Crotty, J.), granting summary judgment in favor

11 of defendant Ernest K. Jacquet. The plaintiff argues that

12 the district court erred by ruling that his claims are

13 outside the scope of New York Labor Law (“NYLL”) §§ 193 and

14 198-b. We review a grant of summary judgment de novo. See

15 Delaney v. Bank of Am. Corp., 766 F.3d 163, 167 (2d Cir.

16 2014). We assume the parties’ familiarity with the

17 underlying facts, the procedural history, and the issues

18 presented for review. 

19

20 1. Under NYLL § 193(1)(b), “[n]o employer shall make

21 any deduction from the wages of an employee, except

22 deductions which . . . are expressly authorized in writing

23 by the employee and are for the benefit of the employee.” 

24 In order to state a claim for a violation of NYLL § 193, a

25 plaintiff must allege a specific deduction from wages and

26 not merely a failure to pay wages. See Kletter v. Fleming,

27 32 A.D.3d 566, 567 (N.Y. App. Div. 3d Dep’t 2006). 

28

29 A “‘deduction’ is more targeted and direct than the

30 wholesale withholding” of wages and “New York courts

31 recognize that the purpose of section 193 is to ‘place the

32 risk of loss for such things as damaged or spoiled

33 merchandise on the employer rather than the employee.’” 

34 Gold v. Am. Med. Alert Corp., 2015 WL 4887525, at *5

35 (S.D.N.Y. Aug. 17, 2015) (quoting Hudacs v. Frito–Lay, Inc.,

36 90 N.Y.2d 342, 349 (1997)). The district court correctly

37 ruled that although Goldberg did not receive wages to which

38 he was entitled, his wages were not reduced in the manner

prohibited by NYLL § 193.1 39 

40

1 Wholesale withholding of wages is covered by NYLL

§ 191, which the parties agree does not apply to the

plaintiff because he was an executive and therefore exempt

from this provision.

2
1 2. Goldberg argues that because he was under threat of

2 termination if he refused to accept lower wages, his

3 employer violated NYLL § 198-b(2), which provides that it is

4 “unlawful for any person . . . to request, demand, or

5 receive . . . a return, donation or contribution of any part

6 or all of [an] employee’s wages [or] salary, . . . upon the

7 statement, representation, or understanding that failure to

8 comply with such request or demand will prevent such

9 employee from procuring or retaining employment.”

10

11 As the district court recognized, this is a novel

12 application of the so-called “kickback” statute because the

13 threatened termination was not coercive in the usual sense;

14 rather, it was a result of the company’s financial trouble. 

15 The company’s distress caused the company to ask the

16 management team, including the plaintiff, to accept a pay

17 cut, and they agreed to do so. The company was never able

18 to secure additional funding to pay back its employees, and

19 eventually ceased all business operations. The “threat of

20 termination” was not a threat as such, but instead was the

21 obvious consequence of what would happen if the company

22 folded due to its financial trouble. Under these

23 circumstances, it cannot be expected that the reach of NYLL

§ 198-b would extend to the conduct at issue.2 24

25

26 For the foregoing reasons, and finding no merit in the

27 plaintiff’s other arguments, we hereby AFFIRM the judgment

28 of the district court.

29

30 FOR THE COURT:

31 CATHERINE O’HAGAN WOLFE, CLERK

32

33

34

2 Notably, the defendant was not the plaintiff’s

employer; rather, the defendant was a majority investor in,

and non-executive Chairman of, Passport Brands, Inc., which

was the plaintiff’s actual employer. The parties do not

address whether the economic realities of the defendant’s

role at Passport were such that he qualified as the

plaintiff’s “employer” for NYLL purposes. See, e.g., Bonito

v. Avalon Partners, Inc., 106 A.D.3d 625, 626 (N.Y. App.

Div. 1st Dep’t 2013).

3