Commercial Division Blog: Current Developments in the Commercial Divisions of the New York State Courts

On September 26, 2024, Justice Joel M. Cohen denied defendant’s motion to dismiss. In Jobar Holding Corp. et. al. v. Halio, Index No. 655689/2017, a family business dispute, Plaintiffs alleged that the Defendant improperly diverted funds from the plaintiff Kobar Holding Corporation to herself and her family. Defendant moved to dismiss the Second Amended Complaint as barred by collateral estoppel and for failure to state a claim pursuant to CPLR § 3211(a)(5) and (7). The court denied the motion, explaining: Read More

On September 30, 2024, Justice Joel M. Cohen issued a Decision and Order in Five Star Electric Corp. v. The Trustees of Columbia University et al., Index No. 655947/2018, granting Defendants’ motion to strike Plaintiff’s complaint pursuant to CPLR § 3126. The action arose from a construction project involving a new building at Columbia University. Defendants moved to strike Plaintiff’s complaint and dismiss the case based on Plaintiff’s claimed willful failure to provide discovery as ordered by the Court. The Court agreed, explaining: Read More

On September 4, 2024, Justice Margaret A. Chan dismissed a counterclaim by defendant Brookline, LLC d/b/a Lilogy (Lilogy) for tortious interference with business relations. The case is BT Supplies West, Inc. v. Brookline, LLC, Index No. 651364/2023. Schlam Stone & Dolan LLP represented plaintiff BT Supplies West, Inc. (BT Supplies) in the matter. Read More

On September 3, 2024, Justice Joel M. Cohen granted defendants’ motion to dismiss, for want of personal jurisdiction, an action seeking damages for the allegedly wrongful overseas seizure of plaintiff’s maritime vessel, the Auzonia. The case is Amelia Maritime Group Ltd. v. Integr8 Fuels America LLC et al., Index No. 152882/2024. Read More

On August 21, 2024, Justice Margaret A. Chan of the New York County Commercial Division issued a decision in Tandym Group, LLC v. Mission Staffing Inc., Index No. 655839/2023, granting defendants' motion to dismiss claims for breach of a purported nonsolicitation and confidentiality agreement on the grounds that (i) plaintiff was not a party to the purported agreement, and (ii) plaintiff failed to allege "which, if any, clients were purportedly solicited or interfered with by defendants," or "what, if any, confidential information was misappropriated," explaining: Read More

On July 10, 2024, Justice Andrea Masley issued a Decision and Order in SC Philips Clark LLC v. Shore Club Property Owner LLC, Index No. 652489/2022, granting, in part, Defendants’ motion to dismiss. Plaintiff brought several claims alleging that defendants usurped plaintiff’s interest in the Shore Club Hotel and adjoining beachfront property, located in Miami Beach, Florida. The Court dismissed, inter alia, plaintiff’s cause of action for breach of the implied covenant of good faith and fair dealing. The Court explained: Read More

On July 8, 2024, Justice Joel M. Cohen denied plaintiffs’ motion to dismiss defendant’s counterclaims based on, inter alia, CPLR § 3211(e)’s single motion rule. McGuigan v. Gendell, Index No. 650294/2021, was a hotly contested dispute between former business partners. Defendants had filed original counterclaims, which plaintiffs moved to dismiss, and which motion the Court granted in part. Subsequently, defendants filed their Second Amended Counterclaims, and plaintiffs again moved to dismiss. In denying the motion, the Court explained: Read More

On May 29, 2024, Justice Andrea Masley granted in part and denied in part a motion to dismiss claims brought against a corporation and its parent under a letter of intent that contemplated an agreement to purchase past-due receivables due to non-parties owned by the non-parent defendant entity. Gramercy Funds Mgt. LLC v Schlumberger N.V., Index No. 653657/2022. Read More

On May 29, 2024, Justice Melissa A. Crane granted one defendant’s motion to dismiss all claims, granted the second defendant’s motion to dismiss in part, and denied plaintiff’s motion to file a second amended complaint. Prager Metis CPAS LLC v Koenig, Index No. 652000/2023. Read More

On May 5, 2024, Justice Andrew Borrok denied defendant’s motion to dismiss defendant’s counterclaim under New York Labor Law. In FF Venture Capital, LLC v. Adam J. Plotkin, RDWC, LLC, Index No. 651314/2023, defendant claimed that plaintiff withheld his compensation and alleged violation of Labor Law § 193. The Court explained that such allegations stated a claim: Read More

On April 12, 2024, Justice Margaret A. Chan granted plaintiff’s motion to dismiss defendants’ counterclaims for breach of contract, unjust enrichment, and breach of fiduciary duty. Defendants in Murphy v. PHG Funding LLC et al., Index No. 656158/2021, alleged counterclaims arising out a settlement with plaintiff and transactions related thereto. As to defendants’ counterclaim for breach of fiduciary duty, the Court explained: Read More

On April 12, 2024, Justice Margaret A. Chan denied defendant’s motion to dismiss plaintiff’s complaint based on documentary evidence, lack of standing/capacity to sue, and for failure to state a claim. In Alternative Global Six, LLC v. Durham Homes, LLC, Index No. 653837, plaintiff alleged a single cause of action for breach of contract based on defendant’s failure to repay loans and interest in the amount of $7,277,969. As to the lack of standing and capacity to sue, Justice Chan explained: Read More

On April 19, 2024, Justice Joel M. Cohen denied a motion to dismiss plaintiff’s claim for fraudulent transfer. The plaintiff in Monex Canada, Inc. v. Bank of America, N.A. et al., Index No. 655076/2023, alleged that a non-party had defrauded it out of millions of dollars by unlawfully reversing Pre-Authorized Debit (“PAD”) transfers, which funds were in turn ultimately directed to the moving defendants. Plaintiff asserted a claim for fraud under the New York Uniform Voidable Transactions Act and in particular Sections 273(a)(1) and 276 of the New York Debtor Creditor Law. The Court rejected the moving defendants’ argument that plaintiff had failed to state a claim for actual fraudulent transfer, explaining: Read More

On March 7, 2024, Justice Andrew Borrok of the New York County Commercial Division issued a decision in UNO A Brokerage Inc v. Inshur, Inc., 2024 NY Slip Op 30733(U), granting Defendant’s motion to dismiss Plaintiff’s claims, including Plaintiff’s claim for breach of contract based on a provision of New York’s statute of frauds, General Obligations Law § 5-701(a)(10). The Court explained in relevant part: Read More

On March 6, 2024, Justice Joel M. Cohen of the New York County Commercial Division issued a decision in Dembicki v. Synergy Health Network, Inc., 2024 NY Slip Op 30704(U), granting Defendants’ motion to dismiss for lack of personal jurisdiction. The Court held that the parties’ agreement to New York law, and to an arbitration clause requiring arbitration of the parties’ claims in New York, was insufficient to create personal jurisdiction over Defendants, who otherwise had no connection to New York. The Court explained: Read More

On January 27, 2024, Justice Andrew Borrok of the New York County Commercial Division, issued a decision in Prosight Specialty Management Company v. Altruis Group, LLC, Index No. 653775/2023, granting plaintiff’s motion to dismiss the defendant’s counterclaims, including defendant’s counterclaim for breach of the implied covenant of good faith and fair dealing as duplicative of the defendant’s counterclaim for breach of contract. The Court explained: Read More

On January 26, 2024, Justice Melissa A. Crane denied defendant’s motion to dismiss for lack or jurisdiction. The decision in Bochenek v. Ashton, Index No. 654904/2022, concerned defendant Twenty Seven Investment Group, LLC (“TSIG”). As to jurisdiction over TSIG, the Court explained: Read More

On January 29, 2024, Justice Andrea Masley of the New York County Commercial Division, issued a decision in One PPW Owner, LLC v IBI Group, 2024 NY Slip Op 30330(U), Index No. 653862/2020, granting third-party defendants’ motion for reargument of the Court’s prior decision denying their motion to dismiss a claim for contribution against them, and upon rearugment, dismissing the contribution claim against them. The Court accepted the third-party defendants’ argument that First Department case law required that the contribution claim against them be dismissed because the damages sought on the underlying claim for malpractice were purely economic in nature. The Court explained: Read More

On December 22, 2023, Justice Margaret A. Chan both granted the motion by certain defendants to dismiss, but also granted plaintiff’s request for sanctions against them. The decision in SG575 Holdings LLC v. Richard Stuyvesant Holdings et al., Index No. 651246/2019, concerned an alleged Ponzi scheme. Plaintiff had deposited $1 million into the escrow account of defendant Pincus Carlebach, a now disbarred attorney, pursuant to a sale/purchase agreement regarding certain real estate, but when the agreement was cancelled, Carlebach had misappropriated the escrowed money. Defendants were parties who had also deposited funds in Carlebach’s account but received their funds back from plaintiff’s $1 million. As to the motion to dismiss, the Court explained: Read More

On December 23, 2023, Justice Joel M. Cohen denied defendants’ motion to dismiss plaintiff’s amended complaint based on the prior granting of plaintiff’s motion to amend. The decision in O’Keefe’s Inc. d/b/a Safti First v. 400 Times Square Associates, LLC et al., Index No. 150702/2019, rejected defendants’ argument that the evidence, affidavits, and submissions by the defendants utterly refuted the plaintiff’s claims. The Court explained: Read More

In a Decision, dated October 4, 2023, in Arthur W. Williams, M.D., v. Mountain Sinai Health System, Inc., Index No. 160367/2019, Justice Melissa A. Crane granted Mount Sinai Health System’s motion for summary judgment on claims of racial discrimination asserted by a former attending neurosurgeon. The Court found that the hospital had proffered legitimate, nondiscriminatory reasons for terminating the plaintiff’s employment and staff privileges. It also rejected the plaintiff’s argument that these reasons were pretextual, noting that the record contained evidence of numerous complaints and suggested that the plaintiff’s patient care and medical judgment were questionable. The Court also rejected the plaintiff’s argument about disparate treatment premised on the hospital affording another terminated employee time to find a new job, whereas it had terminated him immediately. The Court explained: Read More

In an Amended Decision and Order, dated October 24, 2023, in Riverdale Jewish Center v. Consolidated Edison Company of New York, Inc., Index No. 651032/2022, Justice Margaret A. Chan granted Defendant ConEd’s motion to dismiss claims against it for deceptive business practices and affirmative misrepresentation based on allegedly misleading billing inserts. Public utility company ConEd provides gas and electric services to many areas of New York State. The Court ruled that New York’s Public Service Commission had direct regulatory jurisdiction over ConEd’s billing inserts and, therefore, the Court should defer to the agency, rejecting the Plaintiff’s arguments that the question of whether an insert was deceptive fell within the Court’s, not the agency’s, expertise. The Court explained: Read More

In an Decision, dated September 29, 2023, in NW Media Holdings Corp, Newsweek LLC, et al. v. IBT Media Inc., Index No. 652344/2022, Justice Melissa A. Crane granted individual defendant David Jang’s motion to dismiss in their entirety claims made against him under a theory of “alter ego” liability. The Court held that the earlier dismissal of claims against the corporate entity made it impossible to maintain such claims against the entity’s owner. The Court explained: Read More

On October 5, 2023, Justice Joel M. Cohen of the New York County Commercial Division issued a decision in Westport Insurance Corporation v. Aubergene Resorts LLC, Index No. 651396/2022, granting the plaintiff insurer’s motion to dismiss the defendants’ counterclaims, crossclaims and defenses in its entirety. The action was based on a COVID-19 related claim on an insurance policy providing coverage for “direct physical loss or damage.” The court dismissed the defendants’ counterclaims, crossclaims and defenses, finding that no coverage applied as a matter of law based on the First Department’s 2022 decision in Consolidated Rest. Operations, Inc. v. Westport Ins. Corp., 205 AD3d 76 [1st Dept 2022] lv to appeal granted in part, dismissed in part, 39 NY3d 943 [2022]. The Court explained: Read More

On September 28, 2023, Justice Andrew Borrok of the New York County Commercial Division issued a decision in Curia Global, Inc. v. Eagle Pharmaceuticals, Inc., Index No. 651064/2023, denying defendant’s motion to dismiss in its entirety. In relevant part, the Court rejected the defendant’s argument that a the contract’s liquidated damages provision was an unenforceable penalty where the contract required the defendant to pay, as liquidated damages, a set amount per batch of product that defendant firmly forecasted they would purchase from plaintiff, but did not ultimately purchase. The Court explained: Read More

In a Decision and Order, dated June 14, 2023, in 10 Mountainview LLC v. RREF IV-D SN Portfolio, LLC, 2023 NY Slip Op 32034(U), Justice Melissa A. Crane granted Defendant’s motion to dismiss Plaintiff’s breach of contract action based on the claimed failure by Defendant to provide notice of a non-monetary default. Plaintiff and Defendant both loaned money to a non-party borrower, and agreed that Defendant’s loan would be senior. An event of default occurred in 2020, but Defendant did not give notice, and gave notice only when it intended to accelerate its loan. Plaintiff, who had a purchase option, attempted to exercise that option and received a pay-off letter including default interest going back to the date of the earliest default. Plaintiff claimed it was aggrieved because it could have cured the default years earlier and avoided the default interest. The Court explained: Read More

On June 30, 2023, Justice Margaret Chan of the New York County Commercial Division issued a decision in Murphy v. PHG Funding LLC, 2023 N.Y. Misc. LEXIS 3327, denying the defendants’ motion to dismiss on statute of limitations grounds. Specifically, the Court rejected the defendants’ argument that the three-year statute of limitations found in the recently enacted Consumer Credit Fairness Act (“CCFA”) applied, holding that because the action was brought before the passing of the CCFA and there was no showing that the New York legislature intended the CCFA to apply retroactively, the standard six-year statute of limitations for a breach of contract action applied. The Court explained: Read More

On June 22, 2023, Justice Andrew Borrok of the New York County Commercial Division issued a decision in Hieber Astoria LLC v. Taverna, 2023 NYLJ LEXIS 1486, denying the motion to dismiss brought both by the entity defendants as well as the individual defendant. As to the individual defendant, the Court held that “the well-plead [Amended Complaint] alleges sufficient facts, which taken as true as the Court must, are sufficient to pierce the corporate veil and hold Mr. Taverna personally liable.” The Court further explained: Read More

On June 14, 2023, Justice Barry R. Ostrager of the New York County Commercial Division issued a decision in MREF REIT Lender 2 LLC v. FPG Maiden Holdings, LLC, 2023 NY Slip Op 32001(U), denying a defendant Israeli banking corporation's motion to dismiss for lack of personal jurisdiction because the defendant was a member of a lending syndicate for a loan related to a real-estate project in lower Manhattan, explaining:  Read More

On June 5, 2023, Justice Robert R. Reed of the New York County Commercial Division issued a decision in Dragons 516 Ltd v. Knights Genesis Investment Ltd., Slip Op. 50541(U), holding that an attorney entering a stipulation on behalf of a party lacked apparent authority to do so because all representations concerning the attorney's authority came from the attorney (the agent), rather than the client (the principal), but also holding that the attorney may have had actual authority and setting a hearing to resolve the issue, explaining: Read More

On June 6, 2023, Justice Robert R. Reed of the New York County Commercial Division issued a decision in dMY Sponsor, LLC v. Glatt, 2023 NY Slip Op 50547(U), dismissing a negligent-misrepresentation counterclaim on the ground that allegations that the parties had known each other for decades and that the counterclaim defendant was a trusted friend of the counterclaim plaintiff's father were insufficient to give rise to a "special or privity-like relationship imposing a duty on the [counterclaim] defendant to impart correct information to the [counterclaim] plaintiff," explaining: Read More

In Decision and Order, dated March 28, 2023, in NW Media Holdings Corp. v. IBT Media, Inc., Index No. 652344/2022, Justice Melissa Crane granted in part and denied in part defendant Etienne Uzac’s motion to dismiss. This blog commented on a separate opinion in this case on April 5, 2023. The case concerned the purchase of Newsweek by plaintiff NW Media Holdings from defendant IBT. Uzac is a founder and owner of IBT, as well as its CEO. Plaintiff brought several causes of action, but as relevant to the aiding and abetting conversion claim, the Court explained: Read More

In a Decision and Order on Motion, dated April 4, 2023, in Directional Capital LLC v. Butterfly Equity L.P., Index No. 653741/2022, Justice Andrea Masley granted defendant’s motion to dismiss based on documentary evidence.  Plaintiff alleged that defendant violated a non-circumvention provision in the parties’ agreement, claiming it introduced defendant to Qdoba, which defendant subsequently announced it was buying.  The Court explained:  Read More

On March 28, 2023, Justice Joel. M. Cohen of the New York County Commercial Division issued a decision in Andes Petroleum Ecuador Ltd. v. Occidential Petroleum Corp, 2023 N.Y. Misc. LEXIS 1385. In this action, where the claims accrued in Ecuador and thus the Ecuador statute of limitations applied, the Court had previously denied defendant’s motion to dismiss, “finding that [defendant] failed to meet its burden of showing that [plaintiff’s] claims were time-barred under Ecuadorian law.” The First Department reversed and remanded with the instruction that “the Court consider ‘the expert evidence provided by each side concerning what Ecuadorian causes of action are most closely analogous to the New York causes of action’ for fraudulent conveyance.” On remand, the Court held that the most closely analogous Ecuadorian cause of action had a four-year statute of limitations, and that because the claims had been filed more than four years after they accrued, the Court granted the motion to dismiss. The Court explained: Read More