By: Jeffrey M. Haber In today’s Fraud Notes, we examine three decisions issued by the Appellate Division, First Department in which themes familiar to readers of this Blog are at issue: pleading fraud with particularity ( e.g. , here and here ), making a material misstatement of present fact ( e.g. , here and here ) duplication of a breach of contract claim ( e.g. , here , here and here ), pleading justifiable reliance ( e.g. , here , here and here ), and no reliance and

By Jonathan H. Freiberger In this Blog’s August 23, 2021, article, entitled “ Second Department Finds Release Binding Despite Plaintiff’s Claim About Not Understanding the English Language ”(the “Prior Article”), we discussed, inter alia , the import of general releases and the difficulty that one may have invalidating same once executed. One of the leading cases on the law of releases, and as relied upon in the Prior Article, is Centro Emprésarial Cempresa S.A. v. America

By: Jeffrey M. Haber As readers of this Blog know, pleading and proving fraud is not easy. The law reporters (not to mention the pages of this Blog) are bursting with cases in which the courts have dismissed fraud actions due to pleading and proof deficiencies. Moskowitz v. Fischer , 2022 N.Y. Slip Op. 50385(U) (Sup. Ct., Suffolk County May 3, 2022) ( here ), is a recent example of this occurrence. To plead a viable cause of action for fraud, a plaintiff must allege that the

By: Jeffrey M. Haber On May 6, 2022, the Securities and Exchange Commission (“SEC” or the “Commission”) announced (here) the filing of fraud charges against MCC International Corp. (“MCC”), which does business as Mining Capital Coin Corp., its founders Luiz Carlos Capuci, Jr. (“Capuci”) and Emerson Souza Pires (“Pires”), and two other entities controlled by Capuci, CPTLCoin Corp. (“CPTLCoin”) and Bitchain Exchanges (“Bitchain”), in connection with the unregistered offerings a

By: Jeffrey M. Haber Commercial transactions very often involve parties from different states and/or different countries. One party can be domiciled in New York, for example, while the other can be incorporated or headquartered in Delaware or London. When a dispute arises between such geographically diverse parties, questions concerning the jurisdiction of a court over the parties often get litigated. This was the situation in Kingstown Capital Management L.P. v. CPI Property

By Jonathan H. Freiberger The readers of this Blog know that we frequently discuss numerous aspects of residential mortgage litigation. S ee, e.g., < here =">here</a>"> and the articles linked therein. A related subtopic that gets much attention in this Blog is the pre-foreclosure notice requirements of RPAPL 1304 . See, e.g., < here =">here</a>"> , < here =">here</a>"> , < here =">here</a>"> , < here =">here</a>"> , < here =">here</a>"> , < here =">here</a>"> , < here =

By: Jeffrey M. Haber As a general matter, a fraud claim is not duplicative of a contract claim where the plaintiff alleges misrepresentations of fact, as opposed to misrepresentations of a future intent to perform. In IS Chrystie Mgt. LLC v. ADP, LLC , 2022 N.Y. Slip Op. 02950 (1st Dept. May 3, 2022) ( here ), this general principle of law was one of the issues before the Court. In particular, the First Department was asked to determine whether post-contractual misrepresentat

By: Jeffrey M. Haber In Wilsey v. 7203 Rawson Rd., LLC , 2022 N.Y. Slip Op. 02905 (4th Dept. Apr. 29, 2022) ( here ), the Appellate Division, Fourth Department considered principles of law familiar to readers of this Blog; namely, breach of contract and fraudulent misrepresentation. As we have noted in prior articles ( e.g. , here ), “ he essential elements of a cause of action to recover damages for breach of contract are the existence of a contract, the plaintiff’s perfor

By Jonathan H. Freiberger Statute of limitations issues frequently arises in mortgage foreclosure actions. This Blog has written extensively on a variety of issues related to mortgage foreclosure, including those related specifically to limitations periods ( see, e.g., < here =">here</a>"> , < here =">here</a>"> , < here =">here</a>"> and < here =">here</a>"> . In this Blog article entitled: “ Revive a Time-Barred Claim Using § 17-101 of New York’s General Obligations La

By: Jeffrey M. Haber New York courts favor the enforcement of forum selection clauses. They do so because they provide certainty and predictability in the resolution of disputes. here=">here</a>" and="and" >here.=">here</a>."> A forum selection clause is “prima facie valid and enforceable unless it is shown by the challenging party to be unreasonable, unjust, in contravention of public policy, invalid due to fraud or overreaching.” Because a forum selection clause is “prima

By: Jeffrey M. Haber Since inception of this Blog, we have written about many types of fraud, such as affinity fraud, common law fraud, fraud in the inducement, fraudulent concealment, and securities fraud. Until today, we have not directly examined fraud in the execution. 1 Fraud in the execution, or fraud in the factum, arises where a party did not know the nature or the contents of the document being signed, or the consequences of signing it, and was nonetheless misled i

By Jonathan H. Freiberger The readers of this Blog know that we frequently discuss numerous aspects of residential mortgage litigation. S ee, e.g., < here =">here</a>"> and the articles linked therein. A related subtopic that gets much attention in this Blog is the pre-foreclosure notice requirements of RPAPL 1304 . See, e.g., < here =">here</a>"> , < here =">here</a>"> , < here =">here</a>"> , < here =">here</a>"> , < here =">here</a>"> , < here =">here</a>"> , < here =

By: Jeffrey M. Haber Under well-settled principles, summary judgment in lieu of complaint is available for an instrument for the payment of money only. In considering such a motion, the courts will look at the four corners of the instrument sued upon in determining whether the instrument qualifies as one for the payment of money only. See, e.g. ,="3213.&nbsp;<em>See</em>,&nbsp;<em>e.g.</em>," here, here and here.=">here</a>."> Most cases under CPLR § 3213 involve promissor

By: Jeffrey M. Haber Affinity fraud is a type of securities fraud in which the promoter of the fraud preys upon members of an identifiable group, such as a religious or ethnic community, the elderly, or a professional group. The promoter of an affinity fraud frequently is – or pretends to be – a member or a good friend of the group. The promoter often enlists respected members of the community or religious leaders from within the group to disseminate information about the sch

By Jonathan H. Freiberger Personal guaranties are contracts of suretyship pursuant to which “one party as surety binds himself to the second party as creditor to pay a debt contracted by a third party either immediately upon default of the third party or after attempts to effect collection from the third party have failed.” General Phoenix Corp. v. Cabot , 300 N.Y. 87, 92 (1949). As to when the surety’s obligation arises: hether a surety is a guarantor of payment or a guara

By: Jeffrey M. Haber Mandatory arbitration has been around for a long time. It is a mechanism used by, among others, businesses to require consumers to arbitrate their disputes rather than litigate their claims in a court of law. Although in theory a consumer can opt-out of the arbitration requirement, in reality to do so would mean that he or she would not obtain the product or service. For example, a person cannot buy something online, subscribe to a service, or join a club

By: Jeffrey M. Haber Over the years, this Blog has examined numerous cases (indeed, too many to link to) in which the plaintiff claims to have been fraudulently induced to enter into a contract with the defendant. Most of the cases were dismissed because the plaintiff failed to allege a misrepresentation of present fact, as opposed to a misrepresentation of future intent to perform under the contract. Today, we examine, International Business Machines Corp. v. GlobalFoundries

By Jonathan H. Freiberger As noted in several of this Blog’s previous articles < here =">here</a>"> , < here =">here</a>"> and < here =">here</a>"> , when an individual or entity borrows money from a lender, the repayment obligation is typically evidenced by a promissory note. To secure the borrower’s repayment obligations, lenders generally request some form of collateral. When the collateral is an interest in real property, the borrower generally delivers a mortgage to t