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
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
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
COVID-19 has ushered in a new era for litigation in the Commercial Division. Here are the key developments litigants should be aware of.
Remote Appearances and No Paper Copies
In May 2020, e-filing in the Commercial Division resumed in earnest, with a few important differences from the status quo ante:
- Most, if not all, appearances in the Commercial Division are proceeding remotely via Microsoft Teams. While the Commercial Division encourages parties to conduct virtual evidentiary hearings and non-jury trials, in-person jury trials will resume on March 22, 2021.
- Per Administrative Order AO/267/20, paper copies of motions and other documents in e-filed cases are not required in the Commercial Division until further notice. Several Commercial Division Justices in New York County, including Justice Schecter, Justice Masley, and Justice Ostrager, have updated their individual rules to note that working copies are no longer required.
- Foreclosure proceedings and eviction proceedings continue to be subject to restrictions and modified procedures pursuant to various statutes, Executive Orders, and/or Administrative Orders from the Court.
In Gordon v. Verizon Communications, Inc., No. 653084/13, 2017 WL 442871 (N.Y. App. Div. Feb. 2, 2017), the Appellate Division of the Supreme Court of the State of New York, First Judicial Department (the “First Department”), reversed an order denying plaintiffs’ motion for final approval of a proposed non-monetary settlement in a shareholder class action litigation related to Verizon Communication Inc.’s (“Verizon”) acquisition of Vodafone Group PLC’s (“Vodafone”) stake in Verizon Wireless (“VZW”). With its decision, the New York Appellate Division breathed new life into beleaguered disclosure-only class action settlements, and modernized what it believed had become an outdated analytical framework for approving class action settlement agreements. It also appeared to accord special weight to provisions in such agreements whereby corporations promise to obtain fairness opinions in connection with future transactions in determining the overall fairness of the agreements. Thus, while non-monetary class action settlements are increasingly disfavored in other courts — most notably, in the Delaware Court of Chancery — New York courts remain receptive to their utility.
Continue Reading New York Appellate Division Revives Non-Monetary Class Action Settlement in M&A Class Action with Revised Standard of Review