Landlord's Hallway Camera Catches Hubby with Female Visitor; Lawsuit for Prima Facie Tort Survives Dismissal

Otero V Houston St. Owners Corp.

I. BACKGROUND

Plaintiffs sue to recover damages for invasion of privacy from defendants’ installation of cameras on premises where plaintiffs were tenants. Defendants Chaim Babad and Houston Street Owners Corp. owned and defendants Babad Management Co. and Houston Street Management Co. managed the premises. Defendants move to dismiss the complaint on the grounds of a documentary defense and failure to state a claim. C.P.L.R. § 3211(a)(1) and (7). The court grants defendants’ motion to the extent set forth and for the reasons explained below.

II. PLAINTIFFS’ CLAIMS

Plaintiffs allege that defendants’ installation of a camera near plaintiffs’ apartment entrance invaded their privacy and caused damages based on several theories. Defendants claim that plaintiffs lacked a reasonable expectation of privacy in the hallway accessible to the public and that the camera recorded only the hallway outside the apartment, as a device to determine who in fact resided in the apartment.

A. Applicable Standards

The court may dismiss a complaint where documentary evidence utterly refutes plaintiffs’ allegations and conclusively establishes a defense as a matter of law. Goldman v. Metropolitan Life Ins. Co., 5 NY3d 561, 571 (2005); Goshen v. Mutual Life Ins. Co. of NY, 98 NY2d 314, 326 (2002); 511 West 232nd Owners Corp. v. Jennifer Realty Co., 98 NY2d 144, 152 (2002); McCully v. Jersey Partners, Inc., 60 AD3d 562 (1st Dep’t 2009). Upon defendants’ motion to dismiss claims pursuant to C.P.L.R. § 3211(a)(1) or (7), the court may not rely on facts alleged by defendant to defeat the claims unless the evidence demonstrates the absence of any significant dispute regarding those facts and completely negates the allegations against defendants. Lawrence v. Graubard Miller, 11 NY3d 588, 595 (2008); Goshen v. Mutual Life Ins. Co. of NY, 98 NY2d at 326; Leon v. Martinez, 84 NY2d 83, 87-88 (1994); Yoshiharu Igarashi v. Shohaku Higashi, 289 AD2d 128 (1st Dep’t 2001). The court must accept the complaint’s allegations as true, liberally construe them, and draw all reasonable inferences in plaintiffs’ favor. Nonnon v. City of New York, 9 NY3d 825, 827 (2007); Goshen v. Mutual Life Ins. Co. of NY, 98 NY2d at 326; Harris v. IG Greenpoint Corp., 72 AD3d 608, 609 (1st Dep’t 2010); Vig v. New York Hairspray Co., L.P., 67 AD3d 140, 144-45 (1st Dep’t 2009). In short, the court may dismiss a claim based on C.P.L.R. § 3211(a)(7) only if the allegations completely fail to state a claim. Leon v. Martinez, 84 NY2d at 88; Harris v. IG Greenpoint Corp., 72 AD3d at 609; Frank v. Daimler Chrysler Corp., 292 AD2d 118, 121 (1st Dep’t 2002); Scott v. Bell Atl. Corp., 282 AD2d 180, 183 (1st Dep’t 2001).

B. Intentional Infliction of Emotional Distress

To establish plaintiffs’ claim of intentional infliction of emotional distress, plaintiffs must show (1) defendants engaged in extreme and outrageous conduct, (2) with intent to cause or in disregard of a substantial probability that the conduct would cause severe emotional distress, (3) a causal connection between defendants’ acts and plaintiffs’ injury, and (4) severe emotional distress. Howell v. New York Post Co., 81 NY2d 115, 121 (1993); Suarez v. Bakalchuk, 66 AD3d 419 (1st Dep’t 2009). To support the first element alone, plaintiffs must show that defendants’ conduct was “beyond all possible bounds of decency” and “utterly intolerable in a civilized community.” Marmelstein v. Kehillat New Hempstead: The Rav Aron Jofen Community Synagogue, 11 NY3d 15, 22-23 (2008); Howell v. New York Post Co., 81 NY2d at 122; Murphy v. American Home Prods. Corp., 58 NY2d 293, 303 (1983); Suarez v. Bakalchuk, 66 AD3d 419.

Defendants’ commission of a criminal offense may support a finding of outrageous conduct. See Roe v. Barad, 230 AD2d 839, 840 (2d Dep’t 1996); Laurie Marie M. v. Jeffrey T.M., 159 AD2d 52, 55 (2d Dep’t 1990). The New York Penal Law violation plaintiffs rely on, however, proscribes surveillance only of a “person at a place and time when such person has a reasonable expectation of privacy, without such person’s knowledge or consent.” N.Y Penal Law § 250.45(1) and (2). A legitimate expectation of privacy is a demonstrated “expectation of privacy that society recognizes as reasonable.” People v. Ramirez- Portoreal, 88 NY2d 99, 108 (1996). The validity of an expectation of privacy depends on the circumstances. Id. at 109.

While plaintiffs’ expectation of privacy in their apartment behind the closed door is reasonable, see People v.  NY2d 874, 876 (1986), an expectation of privacy in the hallway is not reasonable because it is accessible to other persons. People v. Funches, 89 NY2d 1005, 1007 (1997); People v. Fabelo, 277 AD2d 130, 130-31 (1st Dep’t 2000). Plaintiffs admit that the camera recorded what occurred inside their apartment only when its entrance door was open, yet contend that the camera somehow intruded on their intimate activities. Plaintiffs do not deny that it would have done so only when their entrance door was open.

Plaintiffs further claim that defendants installed the camera to humiliate them to the point of vacating their rent stabilized apartment. Penal Law § 250.45(3) also prohibits surveillance without consent in specified rooms for no legitimate purpose. People v. Evans, 27 AD3d 905, 906 (3d Dep’t 2006). Plaintiffs fail to allege, however, that the camera recorded any room to which the statutory prohibition applies. Therefore plaintiffs fail to show that defendants violated any of Penal Law § 250.45’s provisions.

Plaintiffs’ allegations that defendants’ camera allowed views into their apartment falls short of extreme and outrageous behavior. Even if the camera’s location were considered a trespass into plaintiffs’ apartment, it would not constitute atrocious, indecent, or utterly despicable conduct meeting the requirements for an intentional emotional distress claim. Howell v. New York Post Co., 81 NY2d at 126. While installation of a camera to view plaintiffs surreptitiously where they legitimately expected privacy may constitute extreme and outrageous conduct, Sawicka v. Catena, 79 AD3d 848, 849-50 (2d Dep’t 2010), plaintiffs maintain no reasonable expectation of privacy in the hallway where defendants installed the camera, nor where it viewed into plaintiffs’ apartment only when plaintiffs themselves opened the door. See Howell v. New York Post Co., 81 NY2d at 126. Insofar as defendants’ installation may be considered harassment under the New York Rent Stabilization Code, 9 N.Y.C.R.R. § 2525.5, the determination of whether defendants committed harassment is for the New York State Division of Housing and Community Renewal. 9 N.Y.C.R.R. § 2526.2(c)(2); Sohn v. Calderon, 78 NY2d 755, 765 (1991); Edelstein v. Farber, 27 AD3d 202 (1st Dep’t 2006); Mago, LLC v. Singh, 47 AD3d 772, 773 (2d Dep’t 2008). Therefore, regardless of the outcome of a hearing on service, the court grants defendants’ motion to dismiss plaintiffs’ claim of intentional infliction of emotional distress. C.P.L.R. § 3211(a)(7).

C. Prima Facie Tort

The elements of a prima facie tort are: (1) intentional infliction of harm, (2) causing special damages, (3) without justification or excuse, (4) by otherwise lawful acts. Freihofer v. Hearst Corp., 65 NY2d 135, 142-43 (1985); Curiano v. Suozzi, 63 NY2d 113, 117 (1984); Burns Jackson Miller Summit & Spitzer v. Lindner, 59 NY2d 314, 332 (1983); Posner v. Lewis, 80 AD3d 308, 312 (1st Dep’t 2010). Plaintiffs must plead a “specific and measurable loss” from the tortious conduct to establish special damages. Freihofer v. Hearst Corp., 65 NY2d at 143. See Curiano v. Suozzi, 63 NY2d at 117; DeMicco Bros., Inc. v. Consolidated Edison Co. of NY, Inc., 8 AD3d 99, 100 (1st Dep’t 2004); Vigoda v. DCA Prods. Plus, 293 AD2d 265, 266 (1st Dep’t 2002); Havell v. Islam, 292 AD2d 210 (1st Dep’t 2002). Malevolence must be the sole motivation for defendants’ injurious actions. Curiano v. Suozzi, 63 NY2d at 117; Burns Jackson Miller & Spitzer v. Lindner, 59 NY2d at 333; Posner v. Lewis, 80 AD3d at 312.

Plaintiffs’ allegation in their complaint that defendants placed the camera to force plaintiffs and the other rent regulated tenants to leave in itself demonstrates a purpose beyond the disinterested malevolence required to sustain plaintiffs’ prima facie tort claim. Havell v. Islam, 292 AD2d 210; Smukler v. 12 Lofts Realty, 156 AD2d 161, 163 (1st Dep’t 1989); Rad Adv. v. United Footwear Org., 154 AD2d 309, 310 (1st Dep’t 1989). Plaintiffs’ affidavit opposing defendants’ motion nevertheless clarifies that defendants initially installed a camera motivated by an interest in driving out tenants through surveillance of their infrequent residence, but, when the camera defendants intended their continued use solely to injure plaintiffs.

Plaintiffs’ affidavit alleges the requisite harm and damages in that the surveillance eventually forced them to leave the apartment and caused them marital difficulties and expenses for mental health services. The camera also compelled Jorge Otero to disclose to his wife Georgia Otero that when she was not in the apartment another woman visited, causing additional expenses for counseling and medication, and compelling Georgia Otero to resign from her job and hire an employee to replace her so she could remain at home. Plaintiffs claim $2,500.00 per month for an alternative residence, $10,000.00 per year in psychiatric expenses, and $42,000.00 per year for the employee. Thus, even though the complaint failed to plead disinterested malevolence or special damages, plaintiffs’ affidavit supplements their complaint and cures those deficiencies. Sargiss v. Magarelli, 12 NY3d 527, 531 (2009); Nonnon v. City of New York, 9 NY3d at 827; Amaro v. Gani Realty Corp., 60 AD3d 491, 492 (1st Dep’t 2009).

D. Civil Rights Law §§ 50 and 51

Under New York law, any right to privacy derives only from New York Civil Rights Law §§ 50 and 51. Messenger v. Gruner + Jahr Print. & Publ., 94 NY2d 436, 441 (2000); Howell v. New York Post Co., 81 NY2d at 123; Freihofer v. Hearst Corp., 65 NY2d at 140. Use of a person’s name, portrait, or other picture in advertising or a trade without prior written consent is a misdemeanor. NY Civ. Rights Law § 50; Messenger v. Gruner + Jahr Print. & Publ., 94 NY2d at 441; Stephano v. News Group Publs., 64 NY2d 174, 182 (1984). Persons whose name, portrait, or picture is knowingly used under circumstances that violate Civil Rights Law § 50 may recover damages for injuries sustained from that use. NY Civ. Rights Law § 51; Messenger v. Gruner + Jahr Print. & Publ., 94 NY2d at 441; Bement v. N.Y.P. Holdings, 307 AD2d 86, 89 (1st Dep’t 2003); Molina v. Phoenix Sound, 297 AD2d 595, 596 (1st Dep’t 2002); Hernandez v. Wyeth-Ayerst Labs., 291 AD2d 66, 69 (1st Dep’t 2002). The statutes must be construed narrowly, however, limiting them to non-consensual commercial appropriations of a living person’s name, portrait, or picture. Messenger v. Gruner + Jahr Print. & Publ., 94 NY2d at 441; Finger v. Omni Publs. Intl., 77 NY2d 138, 141 (1990); Stephano v. News Group Publs., 64 NY2d at 183; Guerrero v. Carva, 10 AD3d at 105, 115-16 (1st Dep’t 2004).

To establish that defendants violated these statutes, plaintiffs thus must plead and prove defendants’ (1) use of plaintiffs’ picture (2) within the state of New York, (3) for purposes of advertising or trade, (4) without plaintiffs’ written consent. Molina v. Phoenix Sound, 297 AD2d at 597. Plaintiffs claim defendants’ use of the images captured by the camera, either to determine who resided in their apartment or to force out rent regulated tenants, was a trade purpose.While pleading a trade purpose to support plaintiffs’ Civil Rights Law claim is inconsistent with pleading disinterested malevolence to support their prima facie tort claim, plaintiffs may plead alternatively. C.P.L.R. § 3014; Finkelstein v. Warner Music Group Inc., 14 AD3d 415, 416 (1st Dep’t 2005). See Citi Mgt. Group, Ltd. v. Highbridge House Ogden, LLC, 45 AD3d 487 (1st Dep’t 2007).

Civil Rights Law §§ 50 and 51 do not define advertising or trade purposes, but advertising purposes include use of a name, portrait, or picture in a publication which, as a whole, is distributed to advertise or solicit use of a product or service. Beverley v. Choices Women’s Med. Ctr., 78 NY2d 745, 751 (1991); Guerrero v. Carva, 10 AD3d at 116; Morse v. Studin, 283 AD2d 622 (2d Dep’t 2001). A name, portrait, or picture is used for trade purposes if its use is to attract trade to a business entity. See Ippolito v. Lennon, 150 AD2d 300, 302-303 (1st Dep’t 1989). The content of any text associated with the name, portrait, or picture, rather than a motive for pecuniary gain, determines whether the use is for trade or for excluded newsworthy purposes. Stephano v. News Group Publs., 64 NY2d at 185. See Finger v. Omni Publs. Intl., 77 NY2d at 141-42; Bement v. N.Y.P. Holdings, 307 AD2d at 90. Whether defendants actually attracted customers or profited through the publication, however, are factors showing advertising or trade purposes. Rall v. Hellman, 284 AD2d 113, 114 (1st Dep’t 2001).

In any event, plaintiffs allege nothing that would support an advertising or a trade purpose. Without this essential element, they fail to sustain a claim under the Civil Rights Law.

III. CONCLUSION

For the above reasons, the court grants defendants’ motion to dismiss plaintiffs’ claims for intentional infliction of emotional distress and for violation of New York Civil Rights Law §§ 50 and 51. C.P.L.R. § 3211(a)(7). The court denies defendants’ motion to dismiss plaintiffs’ remaining prima facie tort claim based on documentary evidence or a failure to state a claim for relief. C.P.L.R. § 3211(a)(1) and (7).

Comment: Interesting story. It would appear that the landlord set up a surveillance camera in the hallway outside a rent stabilized apartment, perhaps to gather evidence that the apartment was not the primary residence of the tenant or that it was being put to some use that the landlord could use to legally evict the tenant. Instead, apparently, the cameras recorded the tenant-husband receiving a female guest other than his wife, which caused some domestic unrest, and — very likely – precipitated this lawsuit.

In today’s world, there are surveillance cameras everywhere, mostly for security reasons, and they are allowed everywhere except in places where you have a right to privacy, like bathrooms, and inside your own apartment or home (unless you place them there yourself).

All of these plaintiffs’ theories of liability failed except for “prima facie tort,” which is a catch-all cause of action for lawful actions that are done with bad intent and which cause actual monetary damage. If this case goes to trial, the plaintiffs are going to have to argue to a jury that the landlord put up the camera with the intent of causing some kind of harm to the plaintiffs, and that recording the female visitor’s comings and goings sent the plaintiffs’ marriage into an expensive tailspin.

The depositions should be interesting. Beyond that, however, this decision carries some worrisome implications for all landlords with security cameras.

“Earth Movement” Exclusion Which Specifically Mentions “Man Made” Events Upheld By Court of Appeals

Bentoria Holdings, Inc. v Travelers Indem. Co.

In Pioneer Tower Owners Assn. v State Farm Fire & Cas. Co. (12 NY3d 302 [2009]), we held that an “earth movement” exclusion in an insurance policy did not unambiguously apply to excavation. We now confront a policy in which a similar exclusion is expressly made applicable to “man made” movement of earth. We hold that this added language eliminates the ambiguity, and that loss caused by excavation is excluded from the policy.

Travelers Indemnity Company issued to plaintiff an insurance policy covering “direct physical loss of or damage to” a building in Brooklyn. Under the heading “EXCLUSIONS,” the policy said: “1.We will not pay for loss or damage caused directly or indirectly by any of the following. . . .

****

“b.Earth Movement

**** “(4) Earth sinking (other than sinkhole collapse), rising or shifting including soil conditions which cause settling, cracking or other disarrangement of foundations or other parts of realty. Soil conditions include contraction, expansion, freezing, thawing, erosion, improperly compacted soil and the action of water under the ground surface; “All whether naturally occurring or due to man-made or other artificial causes.”

The building suffered cracks as a result of an excavation being conducted on the lot next door to it. Plaintiff submitted a claim, which Travelers rejected, relying on the earth movement exclusion. Plaintiff sued for breach of the policy. Supreme Court denied Travelers’ motion for summary judgment; the Appellate Division affirmed Co., 84 AD3d 1135 [2d Dept 2011]), but granted leave to appeal to this Court. We now reverse.

Pioneer was in most respects virtually identical to this case. The defendant there insured a building against “accidental direct physical loss”; the building suffered cracks and other damage as a result of an excavation on an adjoining lot. The defendant refused to pay, relying on an earth movement exclusion very similar to the one quoted above, with the distinction that the last words of the earth movement exclusion here — “All whether naturally occurring or due to man-made or other artificial causes” — were absent in Pioneer.

The plaintiff in Pioneer argued that the policy did not clearly exclude “an excavation — the intentional removal of earth by humans.” We found that argument to be “reasonable,” and therefore, held that the earth movement exclusion “did not unambiguously remove” excavation damage from the coverage of the policy. But the same argument is not available to plaintiff here. By expressly excluding earth movement “due to man-made or artificial causes,” the policy contradicts the idea that “the intentional removal of earth by humans” is not an excluded event. This policy cannot reasonably be read to cover the damage on which plaintiff ‘s claim is based.

Accordingly, the order of the Appellate Division should be reversed, with costs, the motion of Travelers Indemnity Company for summary judgment dismissing the complaint as against it granted, and the certified question answered in the negative.

Comment: Thus, for any insurer which has adopted the revised version of the earth movement exclusion, excavation or any other “artificial” cause of soil movement that causes property damage will not be covered.