By: Jeffrey M. Haber Tasty Minstrel Games LLC (“TMG”) is a company, located in Utah, that produces board games.1 The best-known game released by TMG is Yokohama, a board game that takes place in the Meiji era of Japanese history. Another game that TMG produces is “Ponzi Scheme”. In Ponzi Scheme, players try to trick each other into funding fraudulent investments with the promise of extremely high returns. Like a real Ponzi scheme, the scheme works as long as new investors ke

By Jonathan H. Freiberger As discussed previously in this Blog < here =">here</a>"> , the first question asked by a potential client when consulting about a new litigation matter is “can we sue them for our legal fees.” Clients are often dismayed to learn that attorney’s fees are not generally recoverable in litigation under the “American Rule,” because “ n the United States, the prevailing litigant is ordinarily not entitled to collect a reasonable attorney fee from the los

By: Jeffrey Haber In prior articles, we have talked about the importance of saying what you mean in a contract. ( E.g. , here and here .) When contracts are clear and unambiguous, the meaning ascribed to the words used therein will be enforced because they reflect the intent of the parties. Such was the case in Padron v. Granite Broadway Dev. LLC , 2022 N.Y. Slip Op. 05798 (1st Dept. Oct. 18, 2022). In Padron , plaintiff claimed that he sustained injuries when he slipped and

By: Jeffrey M. Haber The voluntary payment doctrine bars recovery of payments voluntarily made with full knowledge of the facts, and in the absence of fraud or material mistake of fact or law. 1 Notably, there is a presumption that payments are voluntary. 2 Thus, to rebut the presumption, the plaintiff must show that he/she protested the payment. In order for a protest to be effective, it must be in writing and (with some exceptions, as discussed below) made at the time of

By Jonathan H. Freiberger Municipalities generally require home improvement contractors to be licensed to perform work. “Where a home improvement contractor is not properly licensed in the municipality where the work is performed at the time the work is performed, the contractor forfeits the right to recover for the work performed, both under the contract and on a quantum meruit basis.” Brightside Home Improvements, Inc. v. Northeast Home Improvement Services , 208 A.D.3d 4

By: Jeffrey M. Haber Since the early 20th century, a plaintiff alleging fraud in New York can recover only the actual pecuniary loss sustained as a result of a misrepresentation or omission, i.e. , the plaintiff’s out-of-pocket damages. 1 The damages recoverable under the out-of-pocket rule are intended to compensate plaintiffs for what they lost because of the fraud, not for what they might have gained. 2 The out-of-pocket rule was at issue in Danco Enters., LLC v. Livexliv

By Jonathan H. Freiberger Section 3101 of the CPLR provides that, in general, “there should be full disclosure of all matter material and necessary in the prosecution or defense of an action, regardless of the burden of proof” by, inter alia , a party and its representatives. “Material and necessary” is “to be interpreted liberally to require disclosure, upon request, of any facts bearing on the controversy which will assist preparation for trial by sharpening the issues an

By: Jeffrey M. Haber In past articles, we have noted the importance of identifying the statements claimed to be false and misleading. In this regard, we talked about the need to plead the who, what, where, when and how of the alleged fraud. In other words, the plaintiff must allege the first paragraph of any newspaper story. The reason for such pleading is to satisfy the particularity requirement of CPLR § 3016(b). Under CPLR § 3016(b), a plaintiff alleging fraud must provid

By Jonathan H. Freiberger For any number of reasons, a party asserting a claim or claims in a litigation may decide that it no loner wishes to pursue them. In such a case, CPLR 3217 outlines the manner in which claims, depending on the stage of litigation, may be discontinued. Among others, an action can be discontinued without a court order: “by serving upon all parties to the action a notice of discontinuance at any time before a responsive pleading is served or, if no r

By Jonathan H. Freiberger In general, to “establish prima facie entitlement to judgment as a matter of law in an action to foreclose a mortgage, a plaintiff must produce the mortgage, the unpaid note, and evidence of default.” M&T Bank v. Barter , 186 A.D.3d 698, 799 (2 nd Dep’t 2020) (citations omitted). As readers of this Blog know, depending on the defenses raised in borrower’s answer, lender may be required to submit additional proof to meet its prima facie case. See,

Financial statements provide important information about a corporation’s financial health.1 They give insight into the corporation’s operations, cash flow, and overall financial condition.2 Investors and shareholders use financial statements to make decisions about whether to purchase the securities of a corporation and, once purchased, the performance of their investment.3 Given the importance of accurate financial statements to the decision-making process of investors and s

By Jonathan H. Freiberger A notice of pendency is a provisional remedy available to litigants seeking a judgment that affects title to real property. 5303 Realty Corp. v. O&Y Equity Corp. , 64 N.Y.2d 313 (1984). The rules concerning notices of pendency are found in Article 65 of the CPLR. As the name suggests, a notice of pendency puts the world on constructive notice that an action has been commenced that may affect the title to the property and, accordingly, “ person w

By: Jeffrey M. Haber It is well-settled that a plaintiff asserting a derivative claim seeks to recover for injury to the business entity. A plaintiff asserting a direct claim seeks redress for injury to himself/herself individually. “The distinction between derivative and direct claims is grounded upon the principle that a stockholder does not have an individual cause of action that derives from harm done to the corporation but may bring a direct claim when the wrongdoer has

By: Jeffrey M. Haber One of the elements of a fraud claim that plaintiffs have difficulty satisfying is justifiable reliance. As evident from the reported decisions, the justifiable reliance element is most often used by defendants to secure dismissal of the claim against them. In LIK Hospitality LLC v. Otway , 2022 N.Y. Slip Op. 32979(U) (Sup. Ct., N.Y. County Aug. 31, 2022) ( here ), a case involving claims of, inter alia , fraudulent inducement, the justifiable reliance el

By: Jeffrey M. Haber Sometimes, a plaintiff will find it difficult to serve a defendant with process. There can be many reasons for such difficulties. Avoidance is one such reason. After all, no one wants to be sued. When a defendant tries to avoid service, a plaintiff may request permission from the court to serve the defendant using alternative means, such as service by publication. That was the situation in Big Yuk Chiu v. Louzon , 2022 N.Y. Slip Op. 32941(U) (Sup. Ct., N.

By: Jeffrey M. Haber On August 26, 2022, the Securities and Exchange Commission (“SEC” or “Commission”) announced ( here ) that it adopted two amendments to the rules governing its whistleblower program. The first rule change allows the Commission to pay whistleblowers for their information and assistance in connection with non-SEC actions in certain circumstances. The second rule affirms the Commission’s authority to consider the dollar amount of a potential award for the l

By Jonathan H. Freiberger Regular readers of this Blog are familiar with Bank of America, N.A. v. Kessler , 202 A.D.3d 10 (2021)(“ Kessler ”), a case about which we have previously written < here ,=">here</a>," here=">here</a>"> and which addresses the pre-foreclosure notice requirements of RPAPL 1304 (a topic that is a frequent subject of this Blog – see < here =">here</a>"> and the articles linked therein). Briefly, as noted in prior Blog articles, RPAPL 1304 requires

By Jonathan H. Freiberger Section 3025 of the CPLR permits litigants to amend their pleadings. Without leave of court, a party can amend a pleading once, as of right, “within twenty days after its service, or at any time before the period for responding to it expires, or within twenty days after service of a pleading responding to it.” CPLR 3025(a). After the expiration of the “as of right” time to amend pleadings, a party can seek the court’s permission (or all parties