Court Opinion

ID: 9945517
Source: CourtListenerOpinion
Date Created: 2024-02-27 21:09:50.090694+00
Date Added: 2024-06-11T14:25:31.287848
License: Public Domain

White Oak Commercial Fin., LLC v NY & Co Ecomm
                          LLC
               2024 NY Slip Op 30576(U)
                    February 23, 2024
           Supreme Court, New York County
        Docket Number: Index No. 650682/2024
                  Judge: Andrea Masley
Cases posted with a "30000" identifier, i.e., 2013 NY Slip
 Op 30001(U), are republished from various New York
 State and local government sources, including the New
  York State Unified Court System's eCourts Service.
 This opinion is uncorrected and not selected for official
                       publication.
                                                                                                                        INDEX NO. 650682/2024
  NYSCEF DOC. NO. 68                                                                                              RECEIVED NYSCEF: 02/23/2024

            SUPREME COURT OF THE STATE OF NEW YORK
            COUNTY OF NEW YORK: COMMERCIAL DIVISION PART 48
            ----------------------------------------------------------------------------------- X

             WHITE OAK COMMERCIAL FINANCE, LLC,                                                     INDEX NO.         650682/2024

                                                          Plaintiff,
                                                                                                    MOTION DATE            N/A
                                                - V -
                                                                                                    MOTION SEQ. NO.        001
             NY AND CO ECOMM LLC, FASHION TO FIGURE
             ECOMM LLC, LORD & TAYLOR ECOMM LLC, LETOTE
             ECOMM LLC, AQUATALIA ECOMM LLC, JOSEPH                                                  DECISION+ ORDER ON
             SAADIA, JACK SAADIA, NY AND CO IP LLC, FASHION                                                MOTION
             TO FIGURE IP LLC,SAADIA GROUP LLC, RTW
             RETAILWINDS ACQUISITION LLC, LORD & TAYLOR
             ACQUISITIONS LLC, LORD & TAYLOR IP LLC, LETOTE
             IP LLC, AQUATALIA IP LLC, 501 JERSEY AVENUE LLC,
             BROOK WAREHOUSING AND DISTRIBUTION LLC, 1735
             JERSEY AVENUE PROPERTY, LLC,SAADIA
             DISTRIBUTION LLC, 1000 STONY BATTERY
             PROPERTY OWNER LLC, and 1000 STONEY BATTERY
             ROAD LLC,

                                                          Defendants.
            ----------------------------------------------------------------------------------- X

            HON. ANDREA MASLEY:

            The following e-filed documents, listed by NYSCEF document number (Motion 001) 33, 34, 35, 36, 37,
            38, 39,40,41,42,43,44,45,46,47,48
            were read on this motion to/for                                   PREL INJUNCTION/TEMP REST ORDR

                      This is an action by plaintiff White Oak Commercial Finance, LLC, the lender,

            against defendants, (a) NY & Co Ecomm LLC, Fashion to Figure Ecomm LLC, Lord &

            Taylor Ecomm LLC, LeTote Ecomm LLC, Aquatalia Ecomm LLC (collectively

            Borrowers), (b) Joseph Saadia, NY and Co IP LLC, Fashion to Figure IP LLC, Saadia

            Group LLC, RTW Retailwinds Acquisition LLC, Lord & Taylor Acquisitions LLC, Lord &

            Taylor IP LLC, LeTote IP LLC, Aquatalia IP LLC (collectively Guarantors), (c) 501

            Jersey Avenue LLC, (d) Jack Saadia, (e) Brook Warehousing and Distribution LLC, (f)

            1735 Jersey Avenue Property LLC, (g) Saadia Distribution LLC, (h) 1000 Stony Battery

             650682/2024 WHITE OAK COMMERCIAL FINANCE, LLC vs. NY AND CO ECOMM LLC ET AL                                Page 1 of 8
             Motion No. 001

                                                                            1 of 8
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                                                                                                    INDEX NO. 650682/2024
  NYSCEF DOC. NO. 68                                                                          RECEIVED NYSCEF: 02/23/2024

            Property Owner Road LLC, and (i) 1000 Stoney Battery Road LLC 1 to recover a money

            judgment of $45,252,694.04 due under a Loan Agreement. (NYSCEF 9, February 1,

            2021 Amended Loan Agreement [Loan Agreement].) Plaintiff asserts that it has UCC

            Article 9 security interests and liens on all of defendants' Collateral 2 and that defendants

            1The term Affiliated Warehouse People (see infra at 4) includes Brook Warehousing
            and Distribution LLC, 1735 Jersey Avenue Property LLC, Saadia Distribution LLC, 1000
            Stony Battery Property Owner Road LLC, and 1000 Stoney Battery Road LLC.
            (NYSCEF 2, Complaint at 2.)

            2 The Loan Agreement states "'Collateral"' to mean "all of the Loan Parties' real and
            personal property, including without limitation, all right, title and interest in and to the
            following: (a) all Receivables; (b) all Equipment; (c) all General Intangibles; (d) all
            Inventory; (e) all Investment Property; (f) all Subsidiary Stock of all Subsidiaries; (g) all
            of Loan Parties' right, title and interest in and to, whether now owned or hereafter
            acquired and wherever located, (i) goods and other property including, but not limited to,
            all merchandise returned or rejected by account debtors, relating to or securing any of
            the Receivables; (ii) all of Loan Parties' rights as a consignor, a consignee, an unpaid
            vendor, mechanic, artisan, or other lienor, including stoppage in transit, setoff, detinue,
            replevin, reclamation and repurchase; (iii) all additional amounts due to any Loan Party
            from any account debtor relating to the Receivables; (iv) other property, including
            warranty claims, relating to any goods securing the Obligations; (v) all of Loan Parties'
            contract rights, rights of payment which have been earned under a contract right,
            instruments (including promissory notes), documents, chattel paper (including electronic
            chattel paper), warehouse receipts, deposit accounts, letters of credit and money; (vi) all
            commercial tort claims (whether now existing or hereafter arising); (vii) if and when
            obtained by any Loan Party, all real and personal property of third parties in which any
            Loan Party has been granted a lien or security interest as security for the payment or
            enforcement of Receivables; (viii) all letter of credit rights (whether or not the respective
            letter of credit is evidenced by a writing); (ix) all supporting obligations; and (x) any other
            goods, personal property or real property now owned or hereafter acquired in which any
            Loan Party has expressly granted a security interest or may in the future grant a
            security interest to Lender hereunder, or in any amendment or supplement hereto or
            thereto, or under any other agreement between Lender and any Loan Party; (h) all
            ledger sheets, ledger cards, files, correspondence, records, books of account, business
            papers, computers, computer software (owned by any Loan Party or in which any Loan
            Party has an interest), computer programs, tapes, disks and documents relating to (a),
            (b), (c), (d), (e), (f) or (g) above; (i) (i) all cash held as cash collateral to the extent not
            otherwise constituting Collateral, all other cash or property at any time on deposit with
            or held by Lender for Loan Parties' account (whether for safekeeping, custody, pledge,
            transmission or otherwise), (ii) all present or future deposit accounts (whether time or
            demand or interest or non-interest bearing) of any Loan Party with Lender or any other
                650682/2024 WHITE OAK COMMERCIAL FINANCE, LLC vs. NY AND CO ECOMM LLC ET AL         Page 2 of 8
                Motion No. 001

                                                             2 of 8
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                                                                                                  INDEX NO. 650682/2024
  NYSCEF DOC. NO. 68                                                                       RECEIVED NYSCEF: 02/23/2024

            have defaulted. (NYSCEF 2, Complaint.) Plaintiff seeks provisional remedies to protect

            its rights as a secured lender by taking possession of inventory, intellectual property,

            electronic passwords, and books and records, among other items of collateral.

                    For the reasons stated on the record on February 13, 20, and 22, 2024, and

            following a hearing on February 22, 2024, plaintiff's motion pursuant to CPLR 6301,

            7102 and 7109 for a preliminary injunction and order of seizure is granted. Plaintiff shall

            submit the transcripts to be so ordered.

                   Accordingly, it is

                    It appearing to this court that several causes of action exist in favor of plaintiff

            and against defendants and that plaintiff is entitled to a preliminary injunction on the

            ground that defendants threaten or are about to do, or are doing or procuring or

            suffering to be done, an act in violation of plaintiff's rights respecting the subject of the

            action and tending to render the judgment ineffectual, as set forth in the decision on the

            record, it is

            Person including those to which any such cash may at any time and from time to time
            be credited, (iii) all investments and reinvestments (however evidenced) of amounts
            from time to time credited to such accounts, and (iv) all interest, dividends, distributions
            and other proceeds payable on or with respect to (x) such investments and
            reinvestments and (y) such accounts; U) all documents of title, policies and certificates
            of insurance, securities, chattel paper, other documents or instruments evidencing or
            pertaining to (a), (b), (c), (d), (e), (f), (g), (h) or (i) above; (k) all guaranties, liens on real
            or personal property, leases, and other agreements and property which in any way
            secure or relate to (a), (b), (c), (d), (e), (h), (i) or (j) above, or are acquired for the
            purpose of securing and enforcing any item thereof; and (I) all proceeds and products of
            (a), (b), (c), (d), (e), (f), (g), (h), (i), U) and (k) in whatever form, including, but not limited
            to: cash, deposit accounts (whether or not comprised solely of proceeds), certificates of
            deposit, insurance proceeds (including hazard, flood and credit insurance), negotiable
            instruments and other instruments for the payment of money, chattel paper, security
            agreements, documents, eminent domain proceeds, condemnation proceeds and tort
            claim proceeds." (NYSCEF 9, February 1, 2021 Loan Agreement at NYSCEF
            pagination at 10-11.)
             650682/2024 WHITE OAK COMMERCIAL FINANCE, LLC vs. NY AND CO ECOMM LLC ET AL          Page 3 of 8
             Motion No. 001

                                                          3 of 8
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                                                                                                    INDEX NO. 650682/2024
  NYSCEF DOC. NO. 68                                                                          RECEIVED NYSCEF: 02/23/2024

                      ORDERED that defendants, their agents, servants, employees and all other

            persons acting under the jurisdiction, supervision and/or direction of defendants, and

            each of their respective officers, directors, managers, employees, members,

            representatives, affiliates, parents, subsidiaries, successors, assigns, agents,

            executors, administrators, and all those acting in concert with and on their behalf are

            enjoined and restrained, during the pendency of this action, from doing or suffering to

            be done, directly or through any attorney, agent, servant, employee or other person

            under the supervision or control of defendants or otherwise, from any of the following

            acts:

                  1. from interfering with plaintiff taking possession of the Collateral 4 to hold during

                      the pendency of this action or until further order of this court or consistent with

                      the laws of the state of New York; and

                  2. from using, removing, transferring, hypothecating, selling, pledging,

                      encumbering, conveying, assigning, destroying, erasing, mutilating, concealing,

                      altering, or disposing of any of the Collateral; and

                  3. from using, removing, transferring, hypothecating, selling, pledging,

                      encumbering, conveying, assigning, destroying, erasing, mutilating, concealing,

                      altering, or disposing of Affiliated Warehouse People's books and records

                      relating to the Collateral;

                  ORDERED that defendants their agents, servants, employees and all other persons

            acting under the jurisdiction, supervision and/or direction of defendants, and each of

            4
             The court is informed that defendants may be operating other businesses out of the
            warehouses. This preliminary injunction is limited to the Collateral.

                650682/2024 WHITE OAK COMMERCIAL FINANCE, LLC vs. NY AND CO ECOMM LLC ET AL         Page 4 of 8
                Motion No. 001

                                                             4 of 8
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                                                                                                 INDEX NO. 650682/2024
  NYSCEF DOC. NO. 68                                                                       RECEIVED NYSCEF: 02/23/2024

            their respective officers, directors, managers, employees, members, representatives,

            affiliates, parents, subsidiaries, successors, assigns, agents, executors, administrators,

            and all those acting in concert with and on their behalf shall produce the Affiliated

            Warehouse People's books and records (both computerized and hard copy and,

            including, but not limited to service records, bank records, and account payable and

            receivable records) relating to any of the Collateral; and it is further

               ORDERED that defendants, their agents, servants, employees and all other persons

            acting under the jurisdiction, supervision and/or direction of defendants, and each of

            their respective officers, directors, managers, employees, members, representatives,

            affiliates, parents, subsidiaries, successors, assigns, agents, executors, administrators,

            and all those acting in concert with and on their behalf shall surrender and deliver the

            Collateral to plaintiff as it may direct, including, but not limited to:

               (i)     all inventory, clothing, retail products, accessories, and any other inventory

                       located at the premises known as 1735 Jersey Avenue, North Brunswick,

                       New Jersey 08902 (NJ Warehouse), and 1000 Stony Battery Road, Lancaster,

                       PA 17601 (PA Warehouse), and anywhere else Collateral may be located;

                       and

               (ii)    all information related to the Borrowers' and Guarantors' internet websites,

                       domain names, customer lists, sales records, trademark lists, inventory

                       reports by category, SKU, and location, including inventory costs and retail

                       price details, and other books and records such as spring, summer, and fall

                       production plans with factories, and the status of payables to critical vendors;

                       and

             650682/2024 WHITE OAK COMMERCIAL FINANCE, LLC vs. NY AND CO ECOMM LLC ET AL         Page 5 of 8
             Motion No. 001

                                                          5 of 8
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                                                                                                 INDEX NO. 650682/2024
  NYSCEF DOC. NO. 68                                                                       RECEIVED NYSCEF: 02/23/2024

               (iii)   all books and records (including, without limitation, digital and paper records,

                       trial balances, journals, accountings, ledgers, general ledgers, laptops,

                       computers, work papers, tax returns, service records, bank records, and

                       accounts payable and receivable records) located at the NJ Warehouse, PA

                       Warehouse, and anywhere else that Borrowers' and Guarantors' books and

                       records are located; and

               (iv)    all other Collateral, including, without limitation, all accounts, goods, cash,

                       equipment, letters of credit rights, deposit accounts, instruments (including

                       promissory notes), electronic chattel paper, subsidiary stock of all

                       subsidiaries, and operating agreements; and it is further

               ORDERED that defendants, their agents, servants, employees and all other persons

            acting under the jurisdiction, supervision and/or direction of defendant, and each of their

            respective officers, directors, managers, employees, members, representatives,

            affiliates, parents, subsidiaries, successors, assigns, agents, executors, administrators,

            and all those acting in concert with and on their behalf shall permit plaintiff full and

            unimpeded access to any Collateral held at the NJ Warehouse, PA Warehouse, and

            anywhere else that Borrowers' and Guarantors' assets, inventory, equipment, and

            books and records are stored; and it is further

               ORDERED that defendants, their agents, servants, employees and all other persons

            acting under the jurisdiction, supervision and/or direction of defendants, and each of

            their respective officers, directors, managers, employees, members, representatives,

            affiliates, parents, subsidiaries, successors, assigns, agents, executors, administrators,

            and all those acting in concert with and on their behalf are preliminarily enjoined and

             650682/2024 WHITE OAK COMMERCIAL FINANCE, LLC vs. NY AND CO ECOMM LLC ET AL         Page 6 of 8
             Motion No. 001

                                                          6 of 8
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                                                                                                    INDEX NO. 650682/2024
  NYSCEF DOC. NO. 68                                                                          RECEIVED NYSCEF: 02/23/2024

            restrained from accessing the Borrowers' and Guarantors' bank accounts maintained

            with TD Bank (account numbers ending 6464, 6456, 4674, 4575, 4369, 4351, 7571,

            7612, 7620, 7604, and 4864) which accounts are enjoined, restrained, and frozen

            pending further order of this court; and it is further

                      ORDERED that plaintiff's application for an order of seizure of the Collateral is

            granted and the Sheriff of the City of New York or the Sheriff of any other county where

            the Collateral may be found, is directed to seize the Collateral and any identifiable

            proceeds thereof, to break open, enter, and search for the Collateral at any place where

            it may be found, and to deliver the Collateral to plaintiff or its agents. Plaintiff may

            submit by filing in NYSCEF a proposed order of seizure and email the proposed order to

            the court in Word; and it is further

                      ORDERED that by close of business on February 23, 2024, 5 defendants, their

            agents, servants, employees and all other persons acting under the jurisdiction,

            supervision and/or direction of defendants, and each of their respective officers,

            directors, managers, employees, members, representatives, affiliates, parents,

            subsidiaries, successors, assigns, agents, executors, administrators, and all those

            acting in concert with and on their behalf, shall provide plaintiff with usernames and

            passwords to all electronic programs (such as, but not limited to, Word, Excel),

            platforms, financial and accounting, inventory, and marketing systems, advertising on

            Google, lnstagram, Tik Tok, and Facebook etc., and web and cloud based programs.

            Plaintiff shall have full visibility into all of defendants' programs, systems, platforms etc.

            5
             Since this directive was given to the parties on the record on February 22, 2023, the
            court has kept this deadline. However, if more time is needed and the parties cannot
            negotiate more time, either party may email the party for an immediate conference.
                650682/2024 WHITE OAK COMMERCIAL FINANCE, LLC vs. NY AND CO ECOMM LLC ET AL         Page 7 of 8
                Motion No. 001

                                                             7 of 8
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                                                                                                  INDEX NO. 650682/2024
  NYSCEF DOC. NO. 68                                                                        RECEIVED NYSCEF: 02/23/2024

            connected to the Collateral. Defendants may not change any credit card, bank account,

            or payment systems connected to the Collateral until further order of the court; and it is

            further

                      ORDERED that since the parties agreed to waive the undertaking in the Loan

            Agreement, but an undertaking is required by CPLR 6312, it is fixed in the nominal sum

            of $1 million conditioned that plaintiff, if it is finally determined that it was not entitled to

            an injunction, will pay to defendants all damages and costs which may be sustained by

            reason of this injunction; and it is further

                      ORDERED that the TRO (NYSCEF 43, OSC with TRO; NYSCEF 49, Amended

            Addendum to OSC) is vacated; and it is further

                      ORDERED that this order grants plaintiff possession of the Collateral during the

            pendency of this action. Plaintiff must follow the laws of the State of New York,

            including the UCC. This order does not authorize plaintiff to immediately dispose of, sell

            or liquidate the Collateral when it comes into plaintiff's possession.

                      2/23/2024
                       DATE                                                     ANDREA MASLEY, J.S.C.
             CHECK ONE:                  CASE DISPOSED                  NON-FINAL DISPOSITION

                                         GRANTED         □ DENIED       GRANTED IN PART          □ OTHER
             APPLICATION:                SETTLE ORDER                   SUBMIT ORDER

             CHECK IF APPROPRIATE:       INCLUDES TRANSFER/REASSIGN     FIDUCIARY APPOINTMENT    □ REFERENCE

             650682/2024 WHITE OAK COMMERCIAL FINANCE, LLC vs. NY AND CO ECOMM LLC ET AL          Page 8 of 8
             Motion No. 001

                                                           8 of 8
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