Unscrupulous bookkeepers or other employees have great potential to embezzle money using forged or other types of bogus checks. In such instances, Article 4 of New York’s Uniform Commercial Code (“Bank Deposits and Collections”) is implicated. “Articles 3 and 4 of the UCC envisions a series of shifting burdens of risk with respect to forged checks.” Putnam Rolling Ladder Co. v. Manufacturers Hanover Trust Co. , 74 N.Y.2d 340, 345 (1989). Under Article 3 of the UCC, a chec

The title of this post captures the recent observation of Justice Joel M. Cohen of the Supreme Court, New York County, Commercial Division. In , 2019 N.Y. Slip Op. 32487(U) (Sup. Ct., N.Y. County Aug. 22, 2019) (here), Justice Cohen stated the following: “In many cases, arbitration is a quick and efficient way to resolve disputes with little or no court involvement. This is not one of those cases.” Slip Op. at *1, citing , 559 U.S. 662 (2010). Arbitration is an alternative f

New York’s Business Corporation Law (“BCL”) provides shareholders owning 50% or more of a corporation two paths to judicial dissolution: a) BCL § 1104 – deadlock at the board or shareholder level such that the corporation “cannot continue to function effectively, and no alternative exists but dissolution”; or b) BCL § 1104-a – where directors or those in control of the corporation have been guilty of illegal, fraudulent or oppressive actions toward the complaining shareholder

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 brimming with cases in which the courts have dismissed fraud actions due to pleading and proof deficiencies. Norddeutsche Landesbank Girozentrale v. Tilton , 2019 N.Y. Slip Op. 32470(U) (Sup. Ct., N.Y. County Aug. 20, 2019) ( here ), is a recent example of this phenomenon. In Norddeutsche , Plaintiffs contended that they were defrauded into inves

It is the end of summer. With Labor Day around the corner, people will be taking vacations or visiting family. Many will be traveling by airplane, train or cruise ship. To do so, they will need a ticket. Many travelers do not realize that their ticket is an important legal document. It not only allows the person to board the means of transportation, but often includes limitations and restrictions, affecting such matters as the forum for dispute resolution, choice of law, and

The location of the place of trial ( or venue) of a legal proceeding in New York State is the location where the action is brought. The plaintiff, as the party bringing the proceeding, generally gets to choose, in the first instance, venue. Plaintiffs, however, do not always choose a proper venue (“Improper Venue Selection”). In such instances, a defendant has an opportunity to change the Improper Venue Selection to a proper one. See CPLR 510 (1) . Other times, although

There is a broad presumption that the public is entitled to access to judicial proceedings and court records. Mosallem v. Berenson , 76 A.D.3d 345, 348 (1st Dept. 2010); Mancheski v. Gabelli Grp. Capital Partners , 39 A.D.3d 499, 501 (2d Dept. 2007); Gryphon Dom. VI, LLC v. APP Intl. Fin. Co., B.V. , 28 A.D.3d 322, 324 (1st Dept. 2006); Danco Labs. v. Chemical Works of Gedeon Richter , 274 A.D.2d 1, 6 (1st Dept. 2000). New York has “long recognized that civil actions and proc

Statutes of limitations are statutory mechanisms that limit the duration of a defendant’s liability for all types of alleged wrongdoing. Depending upon the circumstances, the statute of limitations can be an important topic of discussion between lawyer and client. As many practitioners know, there are exceptions to the general rule that the statute of limitations runs from the time of the tort or breach though no damage occurs until a later time. One exception that practition

It has been some time since this Blog has written an article about whistleblowers and qui tam actions. Those articles typically involved lawsuits arising under the Federal False Claims Act (“Federal False Claims Act”). In today’s post, this Blog looks at City of New York v. Siemens Elec., LLC , 2019 N.Y. Slip Op. 29251 (Sup. Ct., N.Y. County Aug. 7, 2019) ( here ), a qui tam action brought under the New York False Claims Act (“NYFCA”) ( here ) against, among others, Siemens

On July 15, 2019, New York Surrogate Nora Anderson denied, in part, a motion to dismiss the petition filed by Radio Drama Network, Inc. (“Radio Drama” or “Petitioner”), in which Radio Drama sought to invalidate testamentary instruments that deprived it of a $100 million bequest from Himan Brown (“Brown”), the creator of “Dick Tracy” and “Inner Sanctum Mysteries,” and founder of the Himan Brown Revocable Trust (the “Revocable Trust”). Radio Drama Network, Inc. v. Kay , File No

In New York, Section 3211(a) of the Civil Practice Law and Rules (“CPLR”) provides the primary mechanism by which a party can make a motion, before a responsive pleading, to dismiss one or more causes of action alleged against that party. A “cause of action” subject to dismissal under CPLR § 3211(a), includes counterclaims, cross-claims, and third-party claims. There are several grounds under CPLR § 3211(a) on which a party may move to dismiss. These include (but are not lim

On August 6, 2017, Justice Andrew Borrok of the Supreme Court, New York County, Commercial Division, decided In re Everquote, Inc. Securities Litigation , 2019 N.Y. Slip Op. 29242 (Sup. Ct., N.Y. County Aug. 6, 2019) ( here ), in which he held that the automatic stay of discovery required by the Private Securities Litigation Reform Act of 1995 (the “Reform Act” or “PSLRA”), 15 U.S.C. § 77z-1(b)(1), applies in state court as well as in federal court. In doing so, Justice Borro

Forum non conveniens is a common law doctrine in which a court may dismiss an action where another forum would be better suited to adjudicate the matter. In New York, the doctrine is codified in CPLR §327(a). Under this section, a court may stay or dismiss an action if it finds “that in the interest of substantial justice the action should be heard in another forum.” CPLR § 327(a). The party seeking dismissal bears a heavy burden of establishing that New York is not the pro

There is almost nothing more frustrating, or potentially costlier, to a business than a dispute over the meaning of a contract. Such disputes can take many forms. It may be that the language used is ambiguous; or the language is reasonably clear but is susceptible to different meanings; or although the language is clear, taken literally, it might not reflect the parties’ intent; or, as is often the case, an event has occurred that was not contemplated by the parties at the ti

Insurance policies typically provide that the insurer will “defend” its insured in the event of a lawsuit and “indemnify” its insured against liability resulting therefrom. The insurer’s duty to defend, however, is broader than its duty to indemnify. Seaboard Surety Co. v. Gillette Co. , 64 N.Y.2d 304 (1984). Simply stated, an insurer may be obligated to provide a defense to a lawsuit even though it may be relieved of the obligation to indemnify its insured from any judgme

Distinguishing between direct and derivative claims is not easy. Sometimes, the difficulty arises because of the entity involved. For example, in the LLC context, there are fiduciary relationships ( e.g. , managing member and non-managing member) that will support a direct action in circumstances that might otherwise require a derivative action. E.g. , Pokoik v. Pokoik , 115 A.D.3d 428 (1st Dept. 2014); Salm v. Feldstein , 20 A.D.3d 469, 470 (2d Dept. 2005). Other times, the

Last week was a rough one for Facebook, Inc. (FB-NASDAQ). On July 24, 2019, the social network giant, agreed to pay a $100 million fine to the Securities and Exchange Commission (“SEC”) ( here ) to settle claims related to the Cambridge Analytica scandal and a $5 billion penalty to the Federal Trade Commission (“FTC”) to settle claims concerning misleading disclosures related to the company’s privacy practices ( here ). The settlements are the culmination of investigations by

On July 18, 2019, Justice Joel M. Cohen of the Supreme Court, New York County, Commercial Division, decided Shyer v. Shyer , 2019 N.Y. Slip Op. 32138(U) (Sup. Ct., N.Y. County July 18, 2019) ( here ), a third-party action involving allegations of fraudulent concealment relating to the failure to disclose material information about the deteriorating health of a company executive for the purpose of securing about $150,000 in annual benefits. The company, Zyloware Corp. (“Zylowa