In 1975, the New York Legislature adopted Article 9 of the Civil Practice Law and Rules (“CPLR”) to replace the State’s prior class action mechanism. City of New York v. Maul , 14 N.Y.3d 499, 508 (2010). The Legislature did so because Section 1005, which remained virtually unchanged for more than a century, “had been judicially restricted over the years and was subject to inconsistent results.” Id . at 508-509, citing Sperry v. Crompton Corp. , 8 N.Y.3d 204, 210 (2007). By a

It has long been the law in New York that a party’s disclaimer of reliance on extra-contractual representations and omissions will not preclude a fraudulent inducement claim unless: (1) the disclaimer is specific to the fact alleged to be misrepresented or omitted; and (2) the alleged misrepresentation or omission does not concern facts peculiarly within the knowledge of the non-moving party. Basis Yield Alpha Fund v. Goldman Sachs Group, Inc. , 115 A.D.3d 128, 137 (1st Dept

In today’s post, this Blog looks at two cases decided by the Appellate Division, Second Department, involving the first element of a common law fraud and insurance fraud cause of action: the making of a misrepresentation of material fact. In Tsinias Enters. Ltd. v. Taza Grocery, Inc. , 2019 N.Y. Slip Op. 04020 (2d Dept. May 22, 2019) ( here ), the Court affirmed the dismissal of a fraud and fraudulent inducement action because the plaintiff failed to plead a misrepresentation

This Blog has written about the justifiable reliance element of a fraud cause of action on many occasions. We have noted that whether a plaintiff justifiably relied on the misrepresentations and omissions of a defendant is a fact-intensive inquiry. DDJ Mgt., LLC v. Rhone Group L.L.C. , 15 NY3d 147, 155 (2010). In today’s post, we look at Buechel v. Sovereignty, LLC , 2019 N.Y. Slip Op. 31372(U) (Sup. Ct. Tompkins County May 16, 2019) ( here ), a case in which the issue was de

Obtaining jurisdiction over a corporation that is incorporated and headquartered outside of the state can be difficult. A plaintiff must plead and prove that the corporation purposefully availed itself of the resources of the state for a court to exercise personal jurisdiction over the defendants. The failure to do so, as in Poms v. Dominion Diamond Corp. , Index No. 655733/2017, 2019 NY Slip Op 31364(U) (Sup. Ct. N.Y. County May 15, 2019) ( here ), will result in dismissal o

In today’s post, this Blog takes a look at fraud allegations in foreclosure action involving two commercial mortgages that secured more than $24 million in indebtedness. Orchard Hotel LLC v. D.A.B. Group LLC , 2019 N.Y. Slip Op. 03893 (1st Dept. May 16, 2019) ( here ). Relevant to today’s article is the motion court’s denial of a motion to dismiss fraud-based cross-claims and the First Department’s affirmance of that decision. Orchard Hotel LLC v. D.A.B. Group LLC Background

On April 25, 2018, this Blog wrote about INTL FCStone Mkts., LLC v. Corrib Oil Co. Ltd. , 2018 N.Y. Slip Op. 30646(U) (Sup. Ct., N.Y. County, Apr. 9, 2018) ( here .) The case involved a motion for summary judgment involving claims that Defendant, Corrib Oil Co. Ltd. (“Corrib”), owed the plaintiff, INTL FCStone Markets, LLC (“FCStone”), nearly $3.5 million in connection with investment in more than 800 derivatives transactions over a four-year period. In granting the motion, J

FOLLOW-UP – THE NEW YORK COURT OF APPEALS AFFIRMS THE APPELLATE DIVISION, SECOND DEPARTMENT’S, ENFORCEMENT OF WAIVER OF DECLARATORY RELIEF IN COMMERCIAL LEASE RESULTING IN THE DENIAL OF TENANT’S YELLOWSTONE INJUNCTION APPLICATION Our February 9, 2018, Blog post, entitled: “ APPELLATE DIVISION, SECOND DEPARTMENT, ENFORCES WAIVER OF DECLARATORY RELIEF IN COMMERCIAL LEASE RESULTING IN THE DENIAL OF TENANT’S YELLOWSTONE INJUNCTION ,” addressed the decision in 159 MP Corp. v. R

This Blog has previously written about the equitable estoppel doctrine in the context of the statute of limitations ( here ). See General Stencils v. Chiappa , 18 N.Y.2d 125, 128 (1966); Zumpano v. Quinn , 6 N.Y.3d 666, 674 (2006); Matter of Steyer , 70 N.Y.2d 990, 993 (1988). The doctrine has also been used as a basis to reject a jurisdictional defense. Matre v. Erie County Pub. Adm’r. , 283 A.D.2d 1025, 1026 (4th Dept. 2001) (applied to personal jurisdiction and statute of

In Siwiec v. United Rest. Group Inc. , 2019 N.Y. Slip Op. 31152(U) (Sup. Ct. Kings County Apr. 11, 2019) ( here ), the Court reminds litigants that if they want to bring a fraud claim along with a contract claim, they must allege misrepresentations that are collateral or extraneous to the contract. Siwiec involved a dispute over the management of a restaurant. According to the complaint, the parties met in May 2016, when Defendant, Christian Vega (“Vega”), the Chairman and C

This Blog has strived to highlight cases and issues that may be of interest to our readers. Sometimes, however, a case involves so many issues it is hard to isolate one or two for discussion purposes. Such is the case with RKA Film Fin., LLC v. Kavanaugh , 2019 N.Y. Slip Op. 03302 (1st Dept. Apr. 30, 2019) ( here ). RKA Film involved allegations of fraud, fraudulent inducement and negligent misrepresentation in connection with a series of loans that RKA Film Financing, LLC (

Proper service of process is necessary before the court can acquire personal jurisdiction over the defendant to a lawsuit. If service of process is not properly effectuated the court is “…without personal jurisdiction over the defendant, and all subsequent proceedings are thereby rendered null and void.” Citimortgage, Inc. v. Twersky , 153 A.D.3d 1230 (2 nd Dep’t 2017) (citations and internal quotation marks omitted). CPLR 308 sets forth several methods by which servic

This Blog has written about cases in which the plaintiff claims to have been defrauded but fails to allege with particularity the elements of the claim. As readers of this Blog know, the element that most often spells failure for the plaintiff is reasonable reliance – that is, reliance on the alleged misrepresentation or omission. Today’s article looks at another case in which the plaintiff alleged reliance on alleged misrepresentations but failed to assert facts showing that

In Sotheby’s, Inc. v. Chowaiki , 2019 N.Y. Slip Op. 30970(U) (Sup. Ct. N.Y. County Apr. 4, 2019) ( here ), Justice Andrea Masley of the New York Supreme Court, Commercial Division, issued an opinion addressing the question “whether a guarantor remains bound by a guarantee whose underlying contract has since been modified without notice to the guarantor.” As discussed below, the Court held that a guarantor is bound by his/her guaranty notwithstanding modifications to the under

The Second Department has held that “ o state a cause of action to recover damages for legal malpractice, a plaintiff must allege that the attorney failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession, and that the breach of this duty proximately caused the plaintiff to sustain actual and ascertainable damages.” Board of Managers of Bay Club v. Borah, Goldstein, Schwartz, Altschuller & Nahins, P.C. , 97 A.D.3d

As every lawyer knows, the practice of law requires compliance with various deadlines. Some are court ordered, while others are statutory. To be sure, there are many practitioners who do not sweat the time constraints imposed by a deadline. Indeed, “ oo many pages of the Reports, and hours of the courts, are taken up with deadlines that are simply ignored.” Miceli v. State Farm Mut. Auto Ins. Co. , 3 N.Y.3d 725, 727 (2014). However, most lawyers likely wake up in the middle o

In Deutsche Bank National Trust Co. v. Flagstar Capital Markets , the New York Court of Appeals held that an agreement to “delay the commencement” of the statute of limitations “was inconsistent with New York law and public policy.” ( Here .) Thus, although parties may agree after a cause of action has accrued to extend the statute of limitations, they may not do so before their agreement. John J. Kassner & Co. v City of New York , 46 N.Y.2d 544, 550, 551 (1979). Since the pa

On April 10, 2019, the Appellate Division, Second Department, reversed the denial of motions to dismiss fraud claims alleged in connection with the purchase and sale of a $6.2 million home in Harrison, New York. Comora v. Franklin , 2019 N.Y. Slip Op. 02671 (2d Dept. Apr. 10, 2019) ( here ). The decision addresses whether contractual disclaimers can preclude a fraudulent concealment claim. As readers of this Blog know, we recently addressed this issue here and here . Under Ne

In 1970, the New York Legislature enacted General Business Law (“GBL”) § 349, New York’s deceptive trade practices act. As enacted, Section 349 empowered the Attorney General to bring an action to enjoin “ eceptive acts or practices in the conduct of any business, trade or commerce or in the furnishing of any service in th state.” In 1980, the Legislature amended the statute to add Section 349(h), which provides a private right action to consumers seeking to recover damages

As a general rule, a corporation that acquires the assets of another company is not liable for the liabilities of its predecessor. Schumacher v. Richards Shear Co. , 59 N.Y.2d 239, 245(1983). As with many rules, there is an exception. In this instance, the de facto merger doctrine. Under the doctrine, “ corporation may be held liable for the torts of its predecessor if (1) it expressly or impliedly assumed the predecessor’s tort liability, (2) there was a consolidation or m