Kwolek v. NRT New Eng. LLC

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GEMMA KWOLEK, Plaintiff, v. NRT NEW ENGLAND LLC d/b/a, COLDWELL BANKER REALTY, FRANK BALISCIANO, NANCY SILVERSTEIN, And TAYLOR BALISCIANO, Defendants.

CIVIL No. 3:23-CV-01065(JCH)

United States District Court, D. Connecticut

November 3, 2023

RULING ON MOTION TO DISMISS (DOC. NO. 17) AND MOTION TO STRIKE (DOC. NO. 25)

JANET C. HALL, UNITED STATES DISTRICT JUDGE.

I. INTRODUCTION

Plaintiff Gemma Kwolek (“Ms. Kwolek”) brings this action against NRT New England LLC d/b/a Coldwell Banker Realty (“Coldwell”), Frank Balisciano (“Mr Balisciano”), Nancy Silverstein (“Ms Silverstein”), and Taylor Balisciano (“Ms. Balisciano”), asserting claims arising out of an alleged material defect in property purchased from Ms. Balisciano. See Complaint (“Compl.”) (Doc. No. 1). Ms. Kwolek alleges violations of Conn. Gen. Stat. §§ 42-110a et seq. (“Connecticut Unfair Trade Practices Act” or “CUTPA”), concealment of material facts in violation of Conn. Agencies Regs. § 20-328-5a and Conn. Gen. Stat. § 20-320, fraudulent nondisclosure of material facts, breach of fiduciary duties, breach of implied covenant of good faith and fair dealing, civil conspiracy, fraudulent prevention of inquiry, professional negligence, breach of contract, and negligent infliction of emotional distress. Id.

Before this court is a Motion to Dismiss for lack of subject matter jurisdiction filed by Coldwell, Mr. Balisciano, and Ms. Silverstein (collectively “Coldwell defendants”). Motion to Dismiss (“Mot. to Dismiss”) (Doc. No. 17); Memorandum of Law in Support of Mot. to Dismiss (“Mem.”) (Doc. No. 18); Reply to Plaintiff's Opposition to Mot. to Dismiss (“Reply”) (Doc. No. 23). Plaintiff opposes this Motion and moves to strike the Coldwell defendants' Reply brief for raising new legal arguments for the first time. Opposition to Mot. to Dismiss (“Opp.”) (Doc. No. 22); Motion to Strike (“Mot. to Strike”) (Doc. No. 25).

For the reasons set forth below, the court denies the Motion to Dismiss and denies the Motion to Strike as moot.

II. BACKGROUND

A. Alleged Facts

This action was commenced by Ms. Kwolek following her discovery of contaminated soil on property she purchased from Ms. Balisciano. See Compl. at ¶¶ 30-34. The court provides a summary of the well-pleaded factual allegations presented in Ms. Kwolek's Complaint.

Ms. Kwolek purchased a home located at 341 Amity Road, Bethany, Connecticut from Ms. Balisciano under a Dual Agency/Designated Agency Disclosure Notice and Consent Agreement with Coldwell. Id. at ¶ 15. Under this contract, Ms. Silverstein and Mr. Balisciano, both Coldwell real estate agents, represented Ms. Kwolek and Ms. Balisciano, respectively. Id. at ¶ 16.

In August 2021, Ms. Balisciano completed a form titled “Residential Property Condition Report for the Property” as required by Connecticut law, in which she wrote “Not Applicable” or “N/A” to a question asking if she was aware of any problems with the underground storage tank. See id. at ¶¶ 21-22. Neither Mr. Balisciano nor any other Coldwell employee corrected this representation and, prior to closing, none of the defendants informed Ms. Kwolek that a fuel tank had previously been located under the property's lawn. Id. at ¶¶ 23, 28.

On or about August 8, 2021, Ms. Kwolek signed a Real Estate Purchase and Sales Agreement, which contained no references to or disclosures of facts material to the action. Id. at ¶ 25. On September 15, 2021, Ms. Kwolek closed on the home. Id. at ¶ 27.

In late 2022, Ms. Kwolek listed the property for sale. Id. at ¶ 29. During this time, Ms. Kwolek found evidence of a potential underground fuel storage tank. Id. at ¶ 30. On or about February 8, 2023, Ms. Kwolek subsequently contracted with EnviroTech of Fairfield County, Inc. (“EnviroTech”), an environmental services company, to conduct an exploratory excavation. Id. at ¶ 31. EnviroTech did not unearth an intact tank but did find that the soil and groundwater was contaminated with Petroleum, evidence supporting a finding that a fuel tank had previously been located beneath the yard. Id. at ¶¶ 32-35. The levels of ETPH in the soil required remediation. Id. at ¶ 34.

On or about February 14, 2023, Ms. Kwolek entered into another contract with EnviroTech to “excavate, load, transport, and dispose of the contaminated soil and groundwater”. Id. at ¶ 35. “EnviroTech removed approximately 71.63 tons of contaminated soil and 1,975 gallons of contaminated water”. Id. at ¶ 36. As a result of EnviroTech's excavation and remediation efforts, Ms. Kwolek “retain[ed] Simon's Greenhouses Custom Landscaping to, among other things, ‘regrade construction zone,' reset stepping stones,' ‘rake and seed,' ‘put chopped straw down,' and ‘put mulch on disturbed bed area'”. Id. at ¶ 38. In total, Ms. Kwolek incurred $39,433.85 in remediation costs and $1,080 in landscaping costs. Id. at ¶¶ 37-38.

In April 2023, Ms. Kwolek informed Coldwell and the Baliscianos about the soil contamination and sought reimbursement for the remediation costs. Id. at ¶ 40. In response, they “claim[ed] they bore absolutely no responsibility” and, also, shared a document titled “Seller Affirmation of in-ground Oil Tank Removal” that was executed by the previous homeowner, Victor Gugliotti (“Mr. Gugliotti”), and initialed by Ms. Balisciano. Id. at ¶¶ 41-44. The document disclosed that Mr. Gugliotti had removed the oil tank due to water leaking into the lines and further represented that there was no documentation of the removal. Id. at ¶ 43. Coldwell and the Baliscianos did not share this document or make Ms. Kwolek aware of it prior to her purchase of the home. See id. at ¶¶ 48-53.

B. Procedural History

On August 9, 2023, Ms. Kwolek filed her Complaint against the defendants. See Compl. (Doc. No. 1). On September 6, 2023, the Coldwell defendants filed their Motion to Dismiss for lack of subject matter jurisdiction. See Mot. to Dismiss (Doc. No. 17); Mem. (Doc. No. 18). On September 7, 2023, Ms. Balisciano separately filed her Answer to Ms. Kwolek's Complaint. See Answer (Doc. No. 6).

On September 27, 2023, Ms. Kwolek filed her Opposition to the Motion to Dismiss. See Opp. (Doc. No. 22). On October 5, 2023, the Coldwell defendants flied their Reply to Ms. Kwolek's Opposition. See Reply (Doc. No. 23); Affidavit of Att'y Crosby (Doc. No. 24). In response to an argument raised for the first time in the Coldwell defendants' Reply, Ms. Kwolek filed a Motion to Strike, requesting that the court strike these newly minted arguments or, in the alternative, grant Ms. Kwolek leave to file a sur-reply. See Mot. to Strike (Doc. No. 25).

III. STANDARD OF REVIEW

Under Federal Rule of Civil Procedure 12(b)(1), “[a] case is properly dismissed for lack of subject matter jurisdiction . . . when the district court lacks the statutory or constitutional power to adjudicate it.” Makarova v. United States, 201 F.3d 110, 113 (2d Cir. 2000) (citing Fed.R.Civ.P. 12(b)(1)). A plaintiff bears the burden of proving the existence of subject matter jurisdiction by a preponderance of the evidence. Id. When determining whether to dismiss for lack of subject matter jurisdiction, a court may “consider[] evidence outside the pleadings.” See Amidax Trading Grp. v. S.W.I.F.T. SCRL, 671 F.3d 140, 145 (2d Cir. 2011). A court also “has discretion to hold a hearing to resolve factual disputes that bear on the court's jurisdiction.” Saleh v. Sulka Trading, 957 F.3d 348, 353 (2d Cir. 2020). However, a court must otherwise “accept as true all material facts alleged in the complaint and draw all reasonable inferences in the plaintiff's favor.” Id.

IV. DISCUSSION

A. Motion to Dismiss

The Coldwell defendants move to dismiss for failing to allege sufficient facts to establish the threshold controversy required for diversity jurisdiction under section 1332 of title 28. Mem. at 1. In response, Ms. Kwolek counters that the Coldwell defendants have not, as an initial matter, met their burden, and further, have failed to consider all the claims in the Complaint when calculating possible damages. See Opp. at 3, 7-8.

A civil action brought pursuant to section 1332 of title 28 requires complete diversity among parties and an amount in controversy in excess of $75,000. 28 U.S.C. § 1332(a).

There is “a rebuttable presumption that the face of the complaint is a good faith representation of the actual amount in controversy.” Scherer v. Equitable Life Assurance Soc'y of U.S., 347 F.3d 394, 397 (2d Cir. 2003) (quoting Wolde-Meskelv. Vocational Instruction Project Cmty. Servs., Inc., 166 F.3d 59, 63 (2d Cir. 1999)); Washington Nat'l Ins. Co. v. OBEX Grp LLC, 958 F.3d 126, 135 (2d Cir. 2020) (“[t]he sum claimed by the [petitioner] controls if the claim is apparently made in good faith” (internal quotation marks omitted) (quoting A.F.A. Tours, Inc. v. Whitchurch, 937 F.2d 82, 87 (2d Cir. 1991))). Under this presumption, the plaintiff need only show that there is a “reasonable probability” that the action exceeds this jurisdictional threshold. Tongkook Am., Inc. v. Shipton Sportswear Co., 14 F.3d 781,784 (2d Cir. 1994). However, the plaintiff need not allege a specific number to meet the threshold. See Correspondent Servs. Corp. v. First Equities Corp. of Florida, 442 F.3d 767, 769 (2d Cir. 2018) (“the value of the suit's intended benefit or the value of the right being protected or the injury being averted constitutes the amount in controversy when damages are not requested” (quoting Kheel v. Port of New York. Auth., 457 F.2d 46, 49 (2d Cir. 1972))); cf. Wright v. Musanti, 887 F.3d 577, 585 (2d Cir. 2006) (“failure to allege facts establishing jurisdiction need not prove fatal to a complaint” (internal citation omitted)). When a plaintiff does not, as here, plead specific amounts of damages to meet the...