New York Commercial Division Round-Up Blog

News & Updates on Cases Decided in the Commercial Division of the New York State Supreme Court

Latest from New York Commercial Division Round-Up Blog - Page 3

In Webmediabrands, Inc. v. Latinvision, Inc., No. 601048/2010, the Supreme Court (J. Friedman)  pierced the corporate veil at the summary judgment stage.

Under New York law, the factors used to determine whether a court should allow plaintiffs to pierce the corporate veil include “a failure to adhere to corporate formalities, inadequate capitalization, commingling of assets, use of corporate funds for personal use,” an “overlap in ownership and directorship,” and “common use of office space and equipment.” For this reason, corporate veil piercing or alter ego claims of liability are fact-laden and, typically, are not considered well suited for resolution
Continue Reading Commingling and Personal Piggy Bank Leads to Summary Judgment on Veil Piercing Claims

In Mashreqbank PSC v. Ahmed Hamad Al Gosaibi & Bros. Co., 2014 N.Y. Slip Op. 02381, the New York Court of Appeals ruled that a court may sua sponte decide the issue of forum non conveniens so long as it allows the parties to brief and argue the matter.  The Court of Appeals further found that the mere transfer of money through a New York-based bank account was not sufficiently compelling to keep an otherwise foreign case in a New York court.
Continue Reading “Get Outta Here!”: The Court Of Appeals Finds that New York Judges May Sua Sponte Dismiss Cases on Forum Non Conveniens Grounds in Limited Circumstances

The New York Supreme Court, Commercial Division, has announced that two of its judges, Justices Oing and Scarpulla, will participate in a new program strongly encouraging use of hyperlinks in submissions to the Court.  The hyperlinks are to be utilized in all affidavits, affirmations, exhibits within those affidavits and affirmations, and memoranda of law that are filed electronically through the New York State Courts Electronic Filing System (“NYSCEF”) for cases that are assigned to Justices Oing and Scarpulla.
Continue Reading Commercial Division Justices Oing and Scarpulla Participate In New Pilot Program

Several recent decisions by Commercial Division Justices, two of them affirmed by the First Department, have clarified the limitations and standards applied in actions brought pursuant to Article 75 of the CPLR.  Article 75 permits participants in binding arbitration, irrespective of what arbitral forum they are in, to seek assistance from New York State Supreme Court judges under certain circumstances.
Continue Reading The Commercial Division Reviews Arbitrations: Three Recent Decisions Clarify Standards For Actions Brought Pursuant To Article 75 of the CPLR

New York court officials have approved an amendment to Section 202.70(a) of the Commercial Division Rules, which will increase in the minimum monetary threshold of $150,000 to $500,000 for the commencement of lawsuits to be adjudicated in Manhattan’s Commercial Division.  The Commercial Division handles complicated commercial cases as part of the Supreme Court of New York State.  The new rule is effective February 17, 2014.
Continue Reading Monetary Threshold For Commencing Cases In Manhattan’s Commercial Division Raised to $500,000

Effective Monday, February 3rd, Justice Saliann Scarpulla of the New York Supreme Court was appointed to the New York County Commercial Division.  Justice Scarpulla succeeds Justice Barbara Kapnick, who was appointed to the Appellate Division, First Department, by Governor Andrew Cuomo on January 17, 2014.  According to her judicial biography, Justice Scarpulla is a 1986 graduate of Brooklyn Law School.  After law school, Justice Scarpulla was a Court Attorney for Justice Alvin F. Klein (1986-1987), a Litigation Associate at Proskauer Rose LLP (1988-1993), Counsel/Senior Litigator at the FDIC New York Legal Services Office (1993‑1997), and Senior Vice President and
Continue Reading Justice Saliann Scarpulla Appointed to New York County Commercial Division

The Commercial Division Advisory Council has proposed that the court adopt a pilot program for New York County’s Commercial Division that would send every fifth newly assigned case to mediation unless the parties stipulate otherwise or one party makes a good cause showing that mediation would be ineffective or unjust.  A copy of the proposal is available here.
Continue Reading Mandatory Mediation for Every Fifth Case in New York County’s Commercial Division?

In Khalife v. Audi Saradar Private Bank SAL, 2013 NY Slip Op 05971 (1st Dep’t Sept. 24, 2013), the First Department declined to broaden CPLR § 303, holding that the statute does not authorize personal jurisdiction over a foreign person or entity when the non-domiciliary seeks some form of affirmative relief in a New York court, as opposed to commencing an action.  CPLR § 303 provides that “[t]he commencement of an action in the state by a person not subject to personal jurisdiction” designates the non-domiciliary’s attorney as agent for service of process.  Khalife makes it clear that an
Continue Reading First Department Refuses to Expand Jurisdiction over Foreign Entities

In Burlington Coat Factory of N.Y., LLC v. Majestic Rayon Corp., No. 652511/2012, the Supreme Court (J. Kornreich) granted plaintiff Burlington Coat Factory’s (“Burlington”) motion for an injunction to stay and toll the expiration of a thirty-day default cure period and enjoin the defendant landlords Majestic Rayon Corp. and Cudge Realty, LLC (“Landlords”) from terminating Burlington’s lease or tenancy, despite uncertainty over Burlington’s ability to cure the default.  Specifically, the Court found that Burlington’s professed “willingness to do whatever is necessary to cure [the] lease default,” coupled with a potential means to cure, was sufficient to grant the injunctive
Continue Reading “So You’re Saying There’s A Chance…”: Yellowstone Injunctions Alive and Well in the Commercial Division

In Aetna Life Insurance Company v. Appalachian Asset Management Corp, et al., 2013 Slip Op 05506 (1st Dep’t July 30, 2013) the Appellate Division affirmed the April 13, 2012 decision of the New York County Supreme Court, Commercial Division (Ramos, J.), which sustained claims by Aetna Life Insurance Company (“Aetna”) for beach of the Connecticut Unfair Trade Practices Act (“CUTPA”), breach of fiduciary duty, negligence, and recklessness against certain wholly-owned subsidiaries of Lehman Brothers Holding, Inc. (“LBHI”) and individuals acting on behalf of those companies (collectively, the “Defendants”).
Continue Reading First Department Sustains Connecticut Unfair Trade Practices Act and Other Claims Against Subsidiaries and Officers of Lehman Brothers Based Upon An Allegedly Improper Asset Substitution on the Eve of the Lehman Brothers Collapse

In Volpe v. Interpublic Group of Companies, Inc., No. 652308/2012, Judge Eileen Bransten denied plaintiff Ray Volpe’s (“Volpe”) motion to compel arbitration and granted defendant The Interpublic Group of Companies, Inc.’s (“IPG”) cross-motion to stay arbitration.  Citing New York common law, the Court held that Volpe waived his contractual right to arbitration by manifesting an “affirmative acceptance of the judicial process” when he opposed IPG’s separately filed motion to dismiss.
Continue Reading Additional Price of a Judicial Reaction: Waiver of One’s Contractual Right to Arbitration

In Volpe v. Interpublic Group of Companies, Inc., No. 652308/2012, Judge Eileen Bransten granted defendant The Interpublic Group of Companies, Inc.’s (“IPG”) motion to dismiss plaintiff Ray Volpe’s (“Volpe”) complaint, finding that Volpe’s employment agreement with IPG barred him from recovering revenue generated from an agreement he allegedly facilitated between IPG and Facebook, Inc. (“Facebook”). Volpe, who served as the CEO of two wholly-owned IPG subsidiaries, entered into his initial employment agreement with IPG on March 1, 2000 (the “Employment Agreement”).
Continue Reading Unrealized Gains: Integrated Employment Agreement Bars Employee’s Recovery of Additional Compensation

As reported yesterday in the New York Law Journal, Justice Marcy Friedman of the Commercial Division in Manhattan will now be assigned any new case filed in New York Supreme Court that alleges fraud or misrepresentation arising out of the creation or sale of residential mortgage backed securities (“RMBS”) pursuant to a May 23 Order signed by Administrative Justice Sherry Klein Heitler. Justice Heitler had previously reassigned three cases with RMBS as their subject matter to Justice Friedman. According to Justice Heitler, this May 23 order merely codified this pre-existing practice. Justice Heitler stated that she believed that this
Continue Reading All Residential Mortgage Backed Securities Cases To Be Assigned To Justice Friedman of the Commercial Division

In Henkel v. Masiero, Index No. 650425/2012 (N.Y. Sup. Ct., N.Y. Cnty. Mar. 18, 2013) (the “Opinion”), the Supreme Court (J. Bransten) granted the defendants’ motion to dismiss for lack of personal jurisdiction on the grounds that one telephone call with a bank was not sufficient to establish jurisdiction under Section 302(a)(1) of the CPLR, even though almost all of the assets of a corporation were transferred as a result of that call.
Continue Reading Transfer $8 Million Out Of Accounts In New York? That Action Alone Is Not Sufficient To Establish Personal Jurisdiction

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 liability, and refer the matter to a special referee for damages.
Continue Reading First Department Upholds Commercial Division Decision Striking Parties’ Answer And Entering Default Judgment As A Sanction For Discovery Violations

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 the phrase and demonstrate whether such consideration was actually provided. In so doing, the Court of Appeals illustrated that the common recital that consideration includes “other good and valuable consideration” does not free a court to look beyond the four corners of a contract,
Continue Reading Court of Appeals Finds The Phrase “Other Good And Valuable Consideration” In A Contract To Be A Clear And Unambiguous Statement