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First Department Upholds Commercial Division Decision Striking Parties’ Answer And Entering Default Judgment As A Sanction For Discovery Violations

In Suffolk P.E.T. Mgt., LLC v. Anand, 2013 NY Slip Op 02335 (First Dep’t April 4, 2013), the Appellate Division, First Department affirmed an Order by the Supreme Court, New York County Commercial Division (Bernard J. Fried, J.) to strike defendants’ answer for noncompliance with discovery orders and directives, enter default judgment against defendants on … Continue Reading

Court of Appeals Finds The Phrase “Other Good And Valuable Consideration” In A Contract To Be A Clear And Unambiguous Statement

In Schron v. Troutman Saunders LLP, 2013 NY Slip Op 00952 (N.Y. Feb 24, 2013), the New York Court of Appeals held that the phrase “other good and valuable consideration” within a contract was not ambiguous, and therefore extrinsic evidence (evidence other than the contract itself) could not be introduced to explain the meaning of … Continue Reading

Subpoena of AOL Senior Executive Under the “Apex Rule” Disallowed Absent Special Knowledge

In Daou v. Huffington, No. 651997/2010 (N.Y. Sup. Ct., N.Y. Cnty. Feb. 14, 2013), the Supreme Court (J. Ramos) granted nonparty Timothy Armstrong’s (“Armstrong”) motion to quash a subpoena served on him by political consultants Peter Daou and James Boyce (collectively “Plaintiffs”). Plaintiffs sought a deposition of Armstrong regarding his knowledge of the valuation of … Continue Reading

Claims by Alleged Developers of the Huffington Post Permitted to Proceed

In Daou v. Huffington, No. 651997/2010 (N.Y. Sup. Ct., N.Y. Cnty. Feb. 14, 2013)—a case strikingly similar to the Facebook lawsuit popularized in The Social Network—the Supreme Court (J. Ramos) ruled that political consultants Peter Daou and James Boyce (collectively “Plaintiffs”) could proceed on the majority of their claims asserting that Arianna Huffington (“Huffington”), Kenneth … Continue Reading

New York Court of Appeals Upholds Broad Choice of New York Law Provision in Contract Even in Absence of Contacts With New York

In IRB-Brasil Resseguros, S.A. v. Inepar Investments, S.A., No. 191, 2012 WL 6571286 (N.Y. Dec. 18, 2012), the Court of Appeals of the State of New York held that a broad choice of law provision in a contract precludes any need for conflict of law analysis. This decision increases the predictability of corporate contracts containing … Continue Reading

It Ain’t Over ‘Till the Fat Lady Sings – Party’s Contractual Obligations Continue In Agreement To Negotiate

By Sarah Aberg  In IDT Corp. v Tyco Group, S.A.R.L., 2012 NY Slip Op 09190 (1st Dept. Dec. 27, 2012) the Appellate Division held that if you sign a binding agreement that includes an obligation to negotiate, the obligation to negotiate is not extinguished even if the parties sue for other breaches of that agreement.… Continue Reading

Executive Order Suspending New York State Statutes of Limitations To Expire on December 25, 2012

Updating our blog post from November 7, 2012, Governor Andrew Cuomo issued Executive Order 81 on November 20, 2012. Executive Order 81 states that “[t]he suspension of provisions of law ordered by Executive Order Number 52 shall continue through December 25, 2012[.]” The following types of time limitations were suspended by Executive Order 52, and are … Continue Reading

Commercial Division Denies Oral Modification and Grants Summary Judgment in Lieu of Complaint

By Rob Friedman and Tyler Baker In HCG Mezzanine Dev. Fund, L.P. v. Jreck Holdings, LLC, Index No. 652797/2011 (N.Y. Sup., N.Y. Cnty. Oct. 26, 2012), the New York Supreme Court (Kornreich, J.) granted Plaintiff HCG Mezzanine Development Fund, L.P.’s (HCG) motion for summary judgment in lieu of complaint against defendant Jreck Holdings LLC (“Jreck … Continue Reading

Keep Sticking to the Four Corners – Extrinsic Evidence of Parties’ Prior Conduct Cannot Alter the Interpretation of an Unambiguous Contract

By Kevin Puvalowski and Brian Garrett In BDCM Fund Advisor, L.L.C. v. Zenni, No. 602116/08 (N.Y. Sup. Ct. Nov. 15, 2012), Judge Eileen Bransten granted a motion for partial summary judgment for the defendants/counterclaim-plaintiffs, James J. Zenni (“Zenni”) and his group of investment firms (collectively “Defendants”), who were seeking a percentage of the profits from … Continue Reading

Governor Cuomo Issues Executive Order Suspending Statutes of Limitations Due to Hurricane Sandy

On October 31, 2012, Governor Andrew Cuomo issued Executive Order 52, which effectively suspends the statute of limitations for any claim where the time to file such claim expired on October 26, 2012 or later, until further notice. The Governor suspends, among other laws, Section 201 of the New York Civil Practice Law and Rules … Continue Reading

First Department Affirms Commercial Division Ruling That Facts Arising After Litigation Commences Cannot Save An Otherwise Deficient Claim

By Rena Andoh In the case BDCM Fund Adviser, L.L.C. v Zenni, 2012 NY Slip Op 06384 (1st Dep’t Sept. 27, 2012), the First Department unanimously upheld a decision by Justice Eileen Bransten of the Commercial Division dismissing the claims of plaintiffs BDCM Fund Adviser L.L.C., Black Diamond Capital Management Holdings, L.L.C., and Stephen H. … Continue Reading

You May Want to Keep That Opinion To Yourself – Commercial Division Considers Whether a Legal Opinion Letter Triggers Personal Jurisdiction Under the CPLR

By Sarah Aberg In Burt v. Secure Telemedicine, LLC, Index No. 651234/12 (N.Y. Comm. Div., Sept. 14, 2012), the Commercial Division (Schweitzer, J.) reconfirmed the need for specific allegations of personal contact with the state of New York in order for plaintiffs to meet the personal jurisdiction pleading requirements under CPLR 302.… Continue Reading

Do Your Diligence – Commercial Division Finds That Sophisticated Parties May Not Justifiably Rely On Alleged Misrepresentations When Information Is Readily Accessible

By Brian Garrett In Karfunkel v. Sassower, No. 602244/2009 (N.Y. Sup. Ct. Sept. 12, 2012), Judge Peter O. Sherwood granted a motion for summary judgment dismissing plaintiff’s claim of civil fraud for lack of both scienter and justifiable reliance, holding that sophisticated parties may not justifiably rely on alleged fraudulent misrepresentations when accurate information is … Continue Reading

Standing in Another’s Place: The Commercial Division Applies Delaware Law to Specifically Enforce a Contract

In Severstal Dearborn, LLC et al. v. RG Steel, LCC et al., No. 653351/11 (Sup. Ct June 26, 2012) (“Severstal Dearborn”), the New York Commercial Division (Kornreich, J.) recently held that, under Delaware law, where a contract calls for payment of a sum to a third party beneficiary, one party to the contract can compel … Continue Reading

Buyer Beware: Court Decision Highlights Importance of Performing Careful Diligence

By Rena Andoh and Kathryn Hines In Princes Point LLC v. AKRF Engineering, P.C., No. 601849/2008 (N.Y. Sup. Ct. Jul. 13, 2012), Judge Charles Edward Ramos granted a motion for summary judgment dismissing plaintiff’s claims of fraud, negligent misrepresentation, rescission and specific performance, relating to a real estate agreement and amendments thereto.… Continue Reading

Looking to Plain Language of Contract, First Department Grounds Concessionaire’s Hopes for Rights at JFK Airport

By Tyler Baker and Sean Cornely In Ashwood Capital, Inc. v. OTG Management, Inc., No. 652087/10 (N.Y. App. Div. 1st Dep’t Jul. 10, 2012), the New York Appellate Division’s First Department unanimously affirmed the dismissal by the Supreme Court Commercial Division (Ramos, J.) of a claim for breach of contract, which refused to permit a … Continue Reading

Court Provides Guidance for Seeking Damages Arising From Trades of Distressed Claims

By Daniel Brown and Victoria Lee In Deephaven Distressed Opportunities Tradings, Ltd. v. 3V Capital Master Fund Ltd., Index No. 600610/08 (Sup. Ct., NY County, Jun. 26, 2012), Judge Melvin L. Schweitzer denied the plaintiffs’ motion for summary judgment on its damages claims. The case arose from a dispute over the trade of distressed claims … Continue Reading

Court of Appeals Affirms Commercial Division Ruling Stating Creditors of SIV-Lites Have No Cause of Action for Breach of Fiduciary Duty and Tortious Interference Without a Contract

By Sean Cornely and Rena Andoh In Oddo Asset Management v. Barclays Bank PLC, et al., No. 126 (Jul. 27, 2012), Chief Judge Lippman, in a unanimous decision, affirmed the holdings of the Commercial Division of Supreme Court (Kapnick, J.), as upheld by the Appellate Division, 1st Department, by dismissing a lawsuit where a creditor … Continue Reading

Commercial Division Clarifies Limits of Choice of Law Provision in Indentures

By Sarah Aberg In the recent matter Wilmington Trust Natl. Assn. v. Vitro Automotriz, Index No. 652303/11 (N.Y. Sup. Dec. 5, 2011), Justice Bernard J. Fried of the Commercial Division addressed the obligations of guarantors of indentured notes. Regardless that the issuer of the notes had declared bankruptcy in Mexico, the guarantors, none of whom … Continue Reading

Wax This! NY Court Finds Restrictive Covenant In Hair Removal Specialist’s Agreement Unenforceable

By Eric Raphan and Jonathan Sokolowski In a recent decision outside the Commercial Division, Eyes of the World v. Boci, No. CV 46549/09 (N.Y. Civ. Ct. Aug. 19, 2011), Judge Margaret A. Chan held that a former employee’s restrictive covenant, prohibiting her from providing salon services to any client of her former employer for whom … Continue Reading

Defraud A Court? Compensatory Damages Are Okay But Not Punitive Damages

By Mark E. McGrath In CDR Créances S.A.S. v. Cohen, Index Nos. 109565/2003 and 600448/2006 (Sup. Ct., NY County, Aug. 25, 2011) (the “August Decision”), the Honorable O. Peter Sherwood granted the motions of plaintiff CDR Créances S.A.S. (“CDR”) for an order directing entry of judgment on CDR’s compensatory damages but refused to award CDR punitive … Continue Reading
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