A recent decision from New York County Commercial Division Justice Joel M. Cohen highlights the hurdles that defendants face in trying to assert a fraudulent inducement defense to a breach of contract claim. Justice Cohen’s decision also reinforces the potential benefits plaintiffs can enjoy by moving for partial summary judgment early, before fact discovery is completed.Continue Reading New York County Commercial Division Decision Highlights the Hurdles Defendants Face in Asserting Fraudulent Inducement Defense to Breach of Contract
The scope of New York’s long arm jurisdiction may be broader than you anticipate. In State of New York v. Vayu, 2023 N.Y. Slip Op. 801, 2023 WL 1973001 (February 14, 2023), the New York Court of Appeals, in a 5-1 decision, overturned Supreme Court’s and the Third Department’s decisions to dismiss a contractual dispute based on lack of personal jurisdiction over an out-of-state entity that had contracted to provide unmanned aerial vehicles (“UAVs”) to SUNY Stony Brook for use in Madagascar. The Court of Appeals found that Defendant Vayu’s numerous telephone calls and emails to SUNY Stony Brook over the course of two years, and one face-to-face meeting between the two in New York, were sufficient to demonstrate a clear intent by Vayu, a Delaware corporation headquartered in Michigan, to engage purposefully in business activities in New York within the meaning of CPLR § 302(a)(1). While this case did not originate in the Commercial Division, all New York state court practitioners need to take account of the expansion of specific jurisdiction announced in Vayu.Continue Reading New York’s Long-Arm Jurisdiction Extends its Reach
Does the business harm caused by COVID-19 qualify as “direct physical loss” for insurance purposes? In Spirit Airlines, Inc. v. American Home Assurance Company, Index No. 655755/2021, Commercial Division Justice Robert R. Reed held that the answer is no. In a decision announced on the record at an August 18, 2022 oral argument and entered on September 13, 2022 (see here), Justice Reed explained that his decision was dictated by the First Department’s April 7, 2022 decision in Consolidated Restaurant Operations, Inc. v. Westport Insurance Corp., 205 A.D.3d 76 (1st Dep’t 2022), and that he “follow[s] the First Department until the Court of Appeals says that the First Department is wrong.”Continue Reading The Commercial Division Rejects Yet Another Insured’s Claim for Coverage for Covid-Related Revenues Losses
On January 13, 2023, the New York State Commercial Division issued a decision in Bangladesh Bank v. Rizal Commercial Banking Corp., et al., Index No. 652051/2020, that continued New York courts’ tendency to assert personal jurisdiction over foreign banks, even if their only relationship with New York is having correspondent bank accounts. Continue Reading New York Courts Continue to Assert Personal Jurisdiction over Foreign Banks
Effective September 12, 2022, the New York Commercial Division Rules will require parties preparing responsive pleadings to “interlineate” the allegations which they are responding to within the responses themselves. Under new rule 202.70(g), titled “Interlineation of Responsive Pleadings”, counsel will essentially be required to restate the allegations of the complaint before responding to them in an answer. The rule change will likewise apply to answers to counter-claims and cross-claims.
In the New York County Commercial Division, Justice David B. Cohen’s ruling in B&M Kingstone, LLC v. Mega Int’l Comm. Bank Ltd., 2022 NY Slip Op. 30481(U) (Sup. Ct. N.Y. Cnty. 2022) makes clear that New York courts can compel New York branches of non-US banks to disclose information relating to accounts or assets held by branches outside of the United States. It also demonstrates that obtaining such information through judgment enforcement procedures can prove difficult.
Continue Reading Judgment Creditors Beware: Moving For Contempt May Be Within Reach, But Difficult To Grasp
For a moment in March 2020, litigation stopped abruptly when the first case of COVID-19 was confirmed in New York. Within a matter of weeks, the New York State Courts shifted to online operations and, amazingly, the administration of justice continued virtually. Now, nearly two years later, the use of technology to conduct remote hearings and conferences is firmly entrenched in the legal community of New York, making it possible for judges, their support staff, attorneys and litigants to litigate from anywhere with Internet access.
Continue Reading The Changing Landscape of Electronic Service
In Chadha v. Wahedna, 2021 NY Slip Op. 50509(U) (Sup. Ct. N.Y. Cnty. 2021), Justice Ostrager of the New York County Commercial Division, dismissed Plaintiff Nilsa Chadha’s (“Plaintiff”) claims in their entirety due to Plaintiff’s execution of a general release.
Continue Reading New York Courts Continue to Enforce Broad General Releases, Even When Claims are Unforeseeable at the Time of Contract Execution
Tharunidhar Narravula et al v. Perosphere Technologies, Inc. et al, Index No. 900410-21, Supreme Court, Albany County
In Narravula v. Perosphere Tech., 2021 NY Slip Op 50510(U) (Sup. Ct. Albany Cnty. 2021), Justice Richard M. Platkin of the Albany County Commercial Division reinforced the textbook rule that that an individual who signs a contract as an agent for an undisclosed entity can be held personally liable on the contract if the agency relationship is not disclosed.Continue Reading Signing Contracts as a Representative May Lead to Individual Liability
In “Governor Cuomo’s “Tolling” of New York Statutes of Limitation Has Ended, But What Did It Accomplish?”, we examined the debate surrounding whether Governor Cuomo’s Executive Order No. 202.8 and subsequent orders up to and including Executive Order No. 202.67, which extended Executive Order No. 202.8 (collectively, the “Executive Orders”), actually tolled New York statutes of limitation and other litigation deadlines for the period of March 20, 2020 through November 3, 2020, or merely suspended them. For purposes of determining whether a claim or an appeal was timely filed, the answer to this question can have huge implications. If the Executive Orders merely accomplished a suspension, then any claim or filing deadline that would have otherwise lapsed during the period of March 20, 2020 through November 3, 2020 would need to have been filed no later than November 4, 2020—the day after the suspension period ended. On the other hand, if the effect of the Executive Orders was a true tolling of the statutes of limitation and other court deadlines, then any time that remained on the limitations period as of March 20, 2020 would be added back (and start to run again) once the limitations period resumed on November 4, 2020.
Continue Reading The Second Department Weighs in on Tolling vs. Suspension of Statutes of Limitation Pursuant to Governor Cuomo’s COVID-era Executive Orders
Mac Parent LLC v. North American Elite Insurance Company, Index No. 906489/2020, Supreme Court, Albany County
On March 29, 2021, Justice Richard J. Platkin, of the Albany County Commercial Division, dismissed an insurance coverage dispute pursuant to CPLR § 3211(a)(4) due to another action that was pending in New York County, making clear that New York courts do not tolerate forum-shopping in the face of clear forum selection clauses. Mac Parent LLC v. North American Elite Insurance Company, 2021 NY Slip Op 50268(U) (Sup. Ct. Albany Cnty 2021).
Continue Reading Albany Commercial Division Looks Beyond “First-In-Time” Analysis When Considering Dismissal Pursuant to CPLR § 3211(a)(4)