MEMORANDUM DECISION AND ORDER I. INTRODUCTION Plaintiff Sportsinsurance.com, Inc. brings this action against Defendant The Hanover Insurance Company, Inc. Dkt. No. 2 (“Complaint”). In the Complaint, Plaintiff asserts the following causes of action: (1) breach of contract; (2) breach of implied covenant of good faith and fair dealing; and (3) violation of New York General Business Law (“GBL”) §349. Id. at 10-12. Plaintiff also seeks declaratory judgment. Id. at 13. Now before the Court is Defendant’s motion to dismiss the Complaint in its entirety for failure to state a claim upon which relief can be granted. Dkt. No. 5 (“Motion”). Plaintiff opposes the Motion. Dkt. No. 9 (“Response”). Defendant filed a reply to the Response. Dkt. No. 10 (“Reply”). For the reasons discussed below, the Court grants the Motion in part and denies it in part. II. BACKGROUND A. Factual History The following facts, which the Court assumes to be true at this stage, are taken from the Complaint. 1. The Parties and the Policy Plaintiff operates an internet-based brokerage business specializing in the sale of sports insurance products to teams, leagues, and events. Compl. 9. Plaintiff is incorporated in Delaware, has its principal place of business in New York, and conducts its administrative and technical operations from Montréal, Québec. Id. 1. Defendant is an insurance company incorporated in New Hampshire with headquarters in Massachusetts. Id. 2. Defendant issued a commercial crime insurance policy to Plaintiff. Compl. 5; Dkt. No. 5-2 (the “Policy”). 2. The Theft In November 2014, Plaintiff hired Kenza El Baroudi as its vice president of finance and chief financial officer. Compl. 11. Her duties included managing Plaintiff’s payroll, collecting its receivables, and paying its payables. Id. 15. El Baroudi was “entrusted with the day to day operations of the business[.]” Id. 13. El Baroudi embezzled $250,036.30 CAD by: (1) writing checks to herself in excess of her salary; (2) writing checks to Groupe Baroudi Kenza Inc. (“GBK”), El Baroudi’s accounting business; and (3) forging the signature of one of Plaintiff’s principals on a new employment agreement for herself reflecting higher pay, “or procuring such signature by fraudulent means.” Id.
17-18. Plaintiff failed to detect the fraud because El Baroudi “utiliz[ed] various transactions for smaller sums of money” and because it was “unsure of its expenses and financial obligations, which was part of the reason [El] Baroudi was hired.” Id.
