Court Opinion

ID: 4205373
Source: CourtListenerOpinion
Date Created: 2017-09-22 13:10:24.447196+00
Date Added: 2024-06-11T14:41:26.406365
License: Public Domain

NOT FOR PUBLICATION WITHOUT THE
                      APPROVAL OF THE APPELLATE DIVISION
     This opinion shall not "constitute precedent or be binding upon any court."
      Although it is posted on the internet, this opinion is binding only on the
         parties in the case and its use in other cases is limited. R.1:36-3.

                                       SUPERIOR COURT OF NEW JERSEY
                                       APPELLATE DIVISION
                                       DOCKET NO. A-3444-15T1

SPACEAGE CONSULTING CORP.,

        Plaintiff-Appellant,

v.

MARIA VIZCONDE and
HOME BOX OFFICE, INC.,

        Defendants-Respondents.

              Argued September 12, 2017 – Decided September 22, 2017

              Before Judges Yannotti, Carroll and Mawla.

              On appeal from the Superior Court of New
              Jersey, Law Division, Hudson County, Docket
              No. L-1196-14.

              Paul A. Clark, Corporate Counsel, argued the
              cause for appellant (SpaceAge Consulting
              Corp., attorneys; Mr. Clark, on the briefs).

              Colin M. Page argued the cause for respondent
              Maria Vizconde (Colin M. Page & Associates,
              attorneys; Mr. Page, on the brief).

              Robyn L. Aversa argued the cause for
              respondent Home Box Office, Inc. (Jackson
              Lewis, PC, attorneys; Ms. Aversa, of counsel
              and on the brief; Janet O. Lee, on the brief).

PER CURIAM
     The trial court granted summary judgment dismissing plaintiff

SpaceAge    Consulting          Corp.'s      action     against    defendant      Maria

Vizconde    on    the     basis    that   the      employment     agreement    between

plaintiff   and     Vizconde       was    unenforceable       because   it     violated

federal law.        The court also dismissed plaintiff's complaint

against Vizconde's subsequent employer, Home Box Office, Inc.

(HBO), for failure to state a claim.                     Plaintiff's motions for

reconsideration, to amend the complaint, and to disqualify the

motion judge were thereafter denied.                   Plaintiff challenges these

orders on appeal.         For the reasons that follow, we affirm.

                                             I.

     Plaintiff       is     a     software        services    company   that     trains

employees and then assigns them to its clients to provide software

development,      application        integration,       and    technology      training

services.        Plaintiff is an employer governed by the H1-B non-

immigrant worker provisions of the Immigration and Nationality Act

of 1952, 8 U.S.C.A. § 1101 to § 1537, and its implementing

regulations, 20 C.F.R. § 655.700 to 655.855.

     In February 2003, the United States Department of Labor (DOL)

began investigating plaintiff for allegedly violating federal law

governing H-1B employees by not paying wages during their training

periods.    After the DOL completed its investigation, on March 1,

2006, it issued a determination letter advising that the employment

                                             2                                  A-3444-15T1
relationship between plaintiff and its employees, as well as

plaintiff's obligation to pay wages to its H-1B employees, began

when training commenced.        The DOL alleged that plaintiff willfully

failed to pay required prevailing wages to its H-1B employees

during     the   training     period,    as   required   by   8   U.S.C.A.     §

1182(n)(2)(C)(vii), 20 C.F.R. § 655.731(c)(6)(i), and 20 C.F.R. §

655.805(a)(2), and wilfully misrepresented the prevailing wage

rate on two labor condition applications, as required by 8 U.S.C.A.

§ 1182(n)(2)(C)(ii) and 20 C.F.R. §§ 655.730 and 655.805(a)(1),

among other violations.

     The     DOL      subsequently      discovered   that     plaintiff      was

threatening      to   file   lawsuits   against   H-1B   employees   if   they

resigned.    On August 4, 2006, the DOL warned plaintiff that it was

a violation of 20 C.F.R § 655.731(c)(10)(i) to require H-1B

employees to pay a penalty for ceasing employment prior to the

dates in their contracts, and a violation of 20 C.F.R. § 655.801(a)

to intimidate and threaten H-1B employees.

     Plaintiff appealed the DOL's March 1, 2006 determination and

requested a hearing.          In a November 16, 2006 order, a federal

administrative law judge concluded that plaintiff committed the

                                         3                            A-3444-15T1
violations found by the DOL and ordered plaintiff to pay back

wages and civil monetary penalties, among other things.1

       It is within this timeframe that Vizconde's involvement with

plaintiff     commenced.         According       to   plaintiff,    Vizconde   was

residing in the Philippines in January 2004 when she sent an email

to plaintiff stating: "I have read from an advertisement that you

are in need of an [information technology] professional and I

would like to apply for the said position."                  On June 3, 2004,

Vizconde     entered     into    a     written    "train-to-hire"     employment

agreement with plaintiff.            The agreement included an Appendix A,

which provided in relevant part:

             I, Ms. Maria Vizconde[,] hereby agree to a
             three year employment with SpaceAge and hence
             would agree to a three year H1-B visa to be
             filed for me by SpaceAge. I understand that
             the three year period begins when I begin work
             at a project on SpaceAge site or at one of its
             client sites and it does not include any
             training period, leave in excess of authorized
             leave[,] or any other nature of unauthorized
             absence from work.

       The   agreement    also       contained    a   non-compete    clause    that

prohibited Vizconde from working for a client for whom she rendered

services during the contract term and for one year after employment

terminated.     If Vizconde decided to leave plaintiff or otherwise

breached the agreement before completing the contract term, the

1
    We take judicial notice of these administrative proceedings.

                                          4                               A-3444-15T1
agreement required her to pay all training and recruitment fees

at specified rates, as well as other damages and litigation costs.

       Vizconde completed nineteen weeks of training with SpaceAge

from February through June, 2006.               It is undisputed that she was

not paid during this training period.

       On June 13, 2006, Vizconde entered into a new train-to-hire

employment agreement with plaintiff's "sister company," SpaceLabs

Software Services Inc. (SpaceLabs).               The new agreement mandated

that   Vizconde    remain   employed       by    SpaceLabs    for   five    years,

subjected her to prescribed business losses and training costs

should she not do so, and contained a one-year non-compete covenant

following termination of her employment.                The agreement further

specified that it "supersedes all proposals, oral or written,

[and] all other communciations between them relating [to the

agreement]."      SpaceLabs "agree[d] to sponsor Employee['s] [H-1B]

visa and bear all legal fees and costs associated therewith[,]"

and it applied for a H-1B visa for Vizconde that same month.                    The

application    was   approved,     and      Vizconde's       H-1B   visa    became

effective in October 2006.

       In June 2007, plaintiff entered into a contract with Computer

Generated     Solutions,    Inc.   (CGS)         for   plaintiff    to     provide

information technology professionals to CGS.                 CGS in turn placed

Vizconde at HBO, where she began working as a computer programmer

                                       5                                   A-3444-15T1
on July 9, 2007.       The contract between CGS and HBO specified that

HBO would not hire Vizconde without CGS's consent within the first

year, but was thereafter free to hire Vizconde after the one-year

period expired.

      In November 2007, HBO contacted Vizconde to discuss her

employment options.       In or about April 2008, HBO discussed with

Vizconde the possibility of hiring her directly. Vizconde provided

her SpaceLabs contract to HBO.             Consequently, HBO learned that

Vizconde was not a CGS employee, but rather a contract employee

of SpaceLabs, and it declined to extend an offer to Vizconde at

the time.

      The situation changed when, toward the end of April, Surender

Malhan, the owner of SpaceAge and SpaceLabs, was informed that

CGS's contract for Vizconde to work at HBO would end on May 5,

2008.      According to Malhan, he then "told [Vizconde] that her

employment will be transferred from SpaceLabs to SpaceAge which

as   per   my   understanding   of   [H-1B]    laws    requires   ending    the

employment      with    SpaceLabs    and    commencing     employment      with

SpaceAge[,] i.e.[,] cancelling the [H-1B] visa from SpaceLabs and

obtaining an [H-1B] visa from SpaceAge."              Malhan confirmed in a

May 14, 2008 e-mail to Vizconde: "Your employment with SpaceLabs

is terminated effective 5/7/08.            Your visa is being transferred

                                      6                               A-3444-15T1
to SpaceAge."     Vizconde declined Malhan's offer of employment with

SpaceAge by return e-mail.

     HBO sought verification that Vizconde was no longer employed

by SpaceLabs.     On May 13, 2008, Vizconde's attorney provided an

opinion letter to HBO, stating: "I have reviewed [Vizconde's]

employment contract . . . and have concluded she is currently not

employed by SpaceLabs."     Counsel continued:

             Given that Ms. Vizconde is not on a paid
             vacation, and is not assigned to work on any
             client software projects, the contract states
             that   the   "Employee-Employer   relationship
             ceases to exist.        If Employee-Employer
             relationship ceases to exist[,] Employee is
             free to seek employment with another Company."

             Therefore, in light of the quoted language,
             it is my opinion that Ms. Vizconde is free to
             pursue employment with your Company.

HBO then offered Vizconde a position, which she accepted.

     On   March   17,   2014,   plaintiff    filed   a   complaint   against

Vizconde for breach of contract and unjust enrichment, and against

HBO for tortiously interfering with plaintiff's contract with

Vizconde.2     Plaintiff sought damages in the amount of $9850 for

"training fees" and $72,500 for business damages.

     HBO moved to dismiss the complaint for failure to state a

claim, pursuant to Rule 4:6-2(e).           On July 25, 2014, the motion

2
  Plaintiff filed an amended complaint on May 13, 2014, asserting
the same causes of action.

                                     7                               A-3444-15T1
judge dismissed plaintiff's complaint without prejudice as to HBO.

The   judge      found   the   factual    allegations      pled     by   plaintiff

insufficient to establish a cause of action regarding HBO's alleged

interference with plaintiff's contractual relations with Vizconde.

The judge reserved plaintiff's right to move to reinstate the

complaint against HBO if it could develop additional facts to

support its claim.

      On June 23, 2015, plaintiff moved to file a second amended

complaint alleging additional facts and seeking to reinstate its

tortious interference claim against HBO and add new claims against

Vizconde.       On July 31, 2015, while plaintiff's motion to amend was

pending, Vizconde moved for summary judgment.                   She argued, among

other things, that plaintiff's contract was void and unenforceable

because it violated H-1B visa violations.

      The       motion   judge   agreed      that   the     "SpaceAge/SpaceLab

agreements violate[d] [f]ederal H[-1]B [r]egulations[,]" and hence

found them unenforceable.         On September 4, 2015, the motion judge

entered     a   memorializing    order    dismissing      the    complaint.       On

September 10, 2015, the presiding judge of the Civil Part denied

plaintiff's motion to amend, finding it was "now moot in light of

the [motion judge's] decision that the contract(s) are void as

against public policy since they violate a federal statute."

                                         8                                 A-3444-15T1
     Plaintiff moved for reconsideration of the September 4 and

September 10 orders, and to disqualify the motion judge "pursuant

to Rules 1:12 and 1:13 as having expressed bias towards the owner

of SpaceAge and having formed an opinion about the honesty and

credibility of Malhan as a witness based on alleged facts not

before the court."   On October 26, 2015, the motion judge denied

the disqualification motion and the motion to reconsider the

summary judgment order.

     On November 20, 2015, the presiding judge of the Civil Part

denied the motion to reconsider the September 10 order. On January

7, 2016, plaintiff moved to vacate the September 4, 2015 and

October 26, 2015 orders, based on "newly discovered evidence,"

which the motion judge denied on March 4, 2016.     Plaintiff now

appeals from the July 25, 2014, September 4, 2015, October 26,

2015, and March 4, 2016 orders.

                                 II.

                                  A.

     We first address plaintiff's contention that the motion judge

erred by granting summary judgment on its claims against Vizconde.

Plaintiff argues, among other things, that the judge erred in

viewing the evidence in the light most favorable to Vizconde, and

in holding the contract void and unenforceable as contrary to

federal law and public policy.    We disagree.

                                  9                        A-3444-15T1
     We review a grant of summary judgment de novo, observing the

same standard as the trial court.      Townsend v. Pierre, 221 N.J.

36, 59 (2015).   Summary judgment should be granted only if the

record demonstrates there is "no genuine issue as to any material

fact challenged and that the moving party is entitled to a judgment

or order as a matter of law."   R. 4:46-2(c).   We consider "whether

the competent evidential materials presented, when viewed in the

light most favorable to the non-moving party, are sufficient to

permit a rational factfinder to resolve the alleged disputed issue

in favor of the non-moving party."    Davis v. Brickman Landscaping,

Ltd., 219 N.J. 395, 406 (2014) (quoting Brill v. Guardian Life

Ins. Co. of Am., 142 N.J. 520, 540 (1995)).      If no genuine issue

of material fact exists, the inquiry then turns to "whether the

trial court correctly interpreted the law." DepoLink Ct. Reporting

& Litig. Support Servs. v. Rochman, 430 N.J. Super. 325, 333 (App.

Div. 2013) (citations omitted).      We review issues of law de novo

and accord no deference to the trial judge's legal conclusions.

Nicholas v. Mynster, 213 N.J. 463, 478 (2013).

     Federal law requires an employer to pay wages to an H-1B non-

immigrant worker beginning on the date when the worker enters into

employment with the employer.        20 C.F.R. § 655.731(c)(6) and

(7)(i).   The H-1B worker is considered to have entered into

employment with the employer "when he/she first makes him/herself

                                10                           A-3444-15T1
available for work or otherwise comes under the control of the

employer, such as by waiting for an assignment, reporting for

orientation or training, going to an interview or meeting with a

customer, or studying for a licensing examination, and includes

all   activities    thereafter."           20   C.F.R.    §    655.731(c)(6)(i)

(emphasis added).

      Plaintiff    provided   Vizconde       with   training     services     from

February   1,   2006   to   June    18,    2006.    She   thus    entered     into

employment with plaintiff, within the meaning of 20 C.F.R. §

655.731(c)(6)(i), as of February 1, 2006.                     Also, within the

training period, she entered into a new employment agreement with

SpaceLabs. It is undisputed that Vizconde received no wages during

her training period; consequently, both the SpaceAge and SpaceLabs

employment agreements violated federal law.3              We will "refuse to

enforce    contracts   that   are    unconscionable       or    violate    public

policy."    Saxon Constr. & Mgmt. Corp. v. Masterclean of North

Carolina, Inc., 273 N.J. Super. 231, 236 (App. Div.), certif.

denied, 137 N.J. 314 (1994).         "[S]ources of public policy include

federal and state legislation."             Gamble v. Connolly, 399 N.J.

3
  Because we invalidate the employment agreements on this basis,
we need not decide whether the contract provisions that purport
to assess damages against Vizconde for ceasing employment prior
to the expiration of the employment period constitute a penalty
and thus also violate 20 C.F.R. § 655.731(c)(10)(i).

                                      11                                  A-3444-15T1
Super. 130, 144 (Law Div. 2007).          Because both agreements violated

federal   law,    they     were   void        and   unenforceable    ab    initio.

Accordingly,     summary    judgment      dismissing       all   claims    against

Vizconde was properly granted.

                                         B.

      Plaintiff    also    argues   that        the    motion    judge    erred    by

dismissing its tortious interference claim against HBO pursuant

to Rule 4:6-2(e).        In addressing this argument, we note that we

review de novo Rule 4:6-2(e) motions to dismiss for failure to

state a claim.    Rezem Family Assocs., LP v. Borough of Millstone,

423 N.J. Super. 103, 114 (App. Div.), certif. denied, 208 N.J. 366

(2011).   We consider only "'the legal sufficiency of the facts

alleged on the face of the complaint[.]'"                 Nostrame v. Santiago,

213 N.J. 109, 127 (2013) (quoting Printing Mart-Morristown v.

Sharp Elecs. Corp., 116 N.J. 739, 746 (1989)).

      The issue is simply "whether a cause of action is suggested

by the facts."    Velantzas v. Colgate-Palmolive Co., 109 N.J. 189,

192   (1988).     We   "'search[]    the       complaint    in   depth    and   with

liberality to ascertain whether the fundament of a cause of action

may be gleaned even from an obscure statement of claim, opportunity

being given to amend if necessary.'"                  Printing Mart-Morristown,

supra, 116 N.J. at 746 (quoting Di Cristofaro v. Laurel Grove

Mem'l Park, 43 N.J. Super. 244, 252 (App. Div. 1957)).

                                     12                                     A-3444-15T1
     Rule    4:6-2(e)    dismissals   "should    ordinarily    be   without

prejudice and . . . plaintiffs generally should be permitted to

file an amended complaint . . . ."        Nostrame, supra, 213 N.J. at

128; accord Hoffman v. Hampshire Labs, Inc., 405 N.J. Super. 105,

116 (App. Div. 2009).      Dismissal with prejudice should be limited

to situations where the plaintiff's complaint cannot be amended

to state a proper claim.         See Nostrame, supra, 213 N.J. at 128

(affirming dismissal with prejudice where "plaintiff conceded that

he had no further facts to plead").

     "A complaint based on tortious interference must allege facts

that show some protectable right — a prospective economic or

contractual relationship."        Printing Mart-Morristown, supra, 116

N.J. at 751.     Further, (1) the plaintiff must have a "reasonable

expectation of economic advantage"; (2) the interference and harm

inflicted    must   be   done   "intentionally   and   with   malice,"   not

necessarily "ill will," but in the sense of conduct that is

wrongful and "without justification or excuse" under all the

circumstances; (3) the interference must have caused a "loss of

the prospective gain"; and (4) the loss or injury caused damage.

Ibid.     (citations omitted).      Ultimately, a plaintiff bears the

"burden     to   prove   that    defendants   acted    intentionally     and

wrongfully without justification[.]"          Id. at 756.      The factors

most pertinent to the "malice" standard are: "(a) the nature of

                                     13                             A-3444-15T1
the actor's conduct, (b) the actor's motive, [(c)] the interests

sought to be advanced by the actor, and [(d)] the social interest

protecting the freedom of action of the actor and the contractual

interests of the other."       MacDougall v. Weichert, 144 N.J. 380,

404-05 (1996).

     In   plaintiff's   amended   complaint,       it    averred   that   "[b]y

assigning [] Vizconde to work at [] HBO, HBO would have been on

notice that Vizconde was an employee of SpaceAge and under contract

to work for SpaceAge for not less than three years."               The motion

judge found this allegation insufficient to satisfy the second

"malice" prong.

     Even if the court erred in reaching that conclusion at this

preliminary stage of the proceedings, ultimately we discern no

reversible   error.     The   court    dismissed    plaintiff's     complaint

against HBO without prejudice, thereby preserving plaintiff's

right to reassert its claim against HBO should it adduce sufficient

facts to support it.     Subsequent discovery revealed no evidence

that HBO acted maliciously in hiring Vizconde.             Plaintiff did not

have a valid agreement with Vizconde because that agreement had

been superseded by the SpaceLabs agreement.             HBO was informed that

SpaceLabs had terminated Vizconde, and her attorney provided HBO

with a letter stating she was thus free to pursue employment with

HBO. In short, plaintiff failed to show that HBO acted with intent

                                      14                              A-3444-15T1
to inflict harm on it without justification or excuse.                        Moreover,

plaintiff is hard-pressed to claim a protectable right in a

contract that we have found illegal under federal law.

                                           C.

      In its brief, plaintiff argues that the trial court erred in

denying its motion to amend the complaint (1) to allege additional

facts demonstrating that HBO knew that in hiring Vizconde it was

violating the non-compete clause in her contract with plaintiff;

and   (2)   to    assert    breach    of       duty   of    loyalty    and    tortious

interference claims against Vizconde.

      As a threshold matter, we conclude that these arguments are

not properly before us.          As noted, the orders plaintiff identified

in its Notice of Appeal were those entered by the motion judge on

July 25, 2014, September 4, 2015, October 26, 2015, and March 4,

2016.    Importantly, the Notice of Appeal does not include the

orders   entered      by   the   presiding       judge     of   the   Civil    Part    on

September 10, 2015, denying plaintiff's motion to amend, and on

November 20, 2015, denying reconsideration of that motion.

      Our    review    of    a    trial     court's        decisions    is    strictly

circumscribed by the notice of appeal.                     R. 2:5-1(f)(3)(A).          We

review "only the judgment or orders designated in the notice of

appeal[.]"       1266 Apartment Corp. v. New Horizon Deli, Inc., 368

N.J. Super. 456, 459 (App. Div. 2004) (citing Sikes v. Twp. of

                                          15                                    A-3444-15T1
Rockaway, 269 N.J. Super. 463, 465-66 (App. Div.), aff'd o.b., 138

N.J. 41 (1994)).   See also R. 2:5-1(f)(3)(A).   Stated differently,

any arguments raised by plaintiff that fall outside the four

corners of the notice of appeal, such as these, fall outside the

scope of our appellate jurisdiction in this case, and are therefore

not reviewable as a matter of law.

                                 D.

     To the extent that we have not specifically addressed them,

having reviewed the record, we determine that the remaining issues

raised by plaintiff, including its contention that the trial court

erred in denying the disqualification motion, lack sufficient

merit to warrant further discussion in a written opinion.           R.

2:11-3(e)(1)(E).

     Affirmed.

                                16                           A-3444-15T1