Court Opinion

ID: 9958724
Source: CourtListenerOpinion
Date Created: 2024-04-09 20:10:01.947511+00
Date Added: 2024-06-11T08:18:39.593046
License: Public Domain

Jones Law Firm, P.C. v J Synergy Green, Inc.
               2024 NY Slip Op 31127(U)
                      April 2, 2024
           Supreme Court, New York County
        Docket Number: Index No. 653730/2023
                  Judge: Lyle E. Frank
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.
 [FILED: NEW YORK COUNTY CLERK 04/02/2024 12:58 P~                                                                     INDEX NO. 653730/2023
  NYSCEF DOC. NO. 82                                                                                            RECEIVED NYSCEF: 04/02/2024

                                   SUPREME COURT OF THE STATE OF NEW YORK
                                             NEW YORK COUNTY
            PRESENT:             HON. LYLE E. FRANK                                               PART                              11M
                                                                                       Justice
            ----------------------------------------------------------------- ----------------X   INDEX NO.           653730/2023
             JONES LAW FIRM, P.C.,
                                                                                                  MOTION DATE          01/08/2024
                                                         Plaintiff,
                                                                                                  MOTION SEQ. NO.          002
                                                 - V -

             J SYNERGY GREEN, INC.,AVROHOM Y SOROTZKIN,
                                                                                                    DECISION + ORDER ON
             YAAKOV MILSTEIN,
                                                                                                          MOTION
                                                         Defendant.
            ------------------------------------------------------------------- --------------X

             J SYNERGY GREEN, INC., AVROHOM SOROTZKIN,                                                         Third-Party
             YAAKOV MILSTEIN                                                                             Index No. 595867/2023

                                                          Plaintiff,

                                                  -against-

             JONES LAW FIRM, P.C., TANNER JONES, PROFESSIONAL
             ARBITRATION AND MEDIATION, LLC, DAVID TREYSTER

                                                          Defendant.
             -------------------------------------------------------------------------------- X

            The following e-filed documents, listed by NYSCEF document number (Motion 002) 48, 49, 50, 75, 76,
            77, 78, 79
            were read on this motion to/for                                                         DISMISS

                      Upon the foregoing documents, third-party defendant Professional Arbitration and

            Mediation LLC's (PAM) motion to dismiss the third-party complaint is granted and the cross-

            motion to amend the third-party complaint is denied.

                      The underlying action arises out of allegations that defendant/third-party plaintiff failed

            to pay plaintiffs legal fees as required by its engagement agreement. The third-party action and

            counterclaims arise out of the plaintiffs relationship with third-party defendants PAM and David

            Treyster, in that defendants/third-party plaintiffs were caused to suffer damages based on the

             653730/2023 Motion No. 002                                                                                Page 1 of4

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 [FILED: NEW YORK COUNTY CLERK 04/02/2024 12:58 P~                                                   INDEX NO. 653730/2023
  NYSCEF DOC. NO. 82                                                                         RECEIVED NYSCEF: 04/02/2024

            failure to disclose the relationship. It is undisputed that at the time the engagement agreement

            was signed by plaintiff and defendants, plaintiffs principal had a 100% ownership interest in

            PAM.

                     Prior to filing the instant motion, the defendants/third-party plaintiffs and PAM entered

            into a stipulation that withdrew all causes of action as against PAM with the exception of the

            first cause of action of fraud and fifth Counterclaim alleging conspiracy to violate Judiciary Law

            § 487.

                     It is well-settled that on a motion to dismiss for failure to state a cause of action pursuant

            to CPLR § 321 l(a)(7), the pleading is to be liberally construed, accepting all the facts as alleged

            in the pleading to be true and giving the plaintiff the benefit of every possible inference. See

           Avgush v Town of Yorktown, 303 AD2d 340 [2d Dept 2003]; Bernbergv Health Mgmt. Sys., 303

            AD2d 348 [2d Dept 2003]. Moreover, the Court must determine whether a cognizable cause of

            action can be discerned from the complaint rather than properly stated. Matlin Patterson ATA

            Holdings LLC v Fed. Express Corp., 87 AD3d 836, 839 [1st Dept 2011]. "The complaint must

            contain allegations concerning each of the material elements necessary to sustain recovery under

            a viable legal theory."' Id.

                     "To establish fraud, a plaintiff must show 'a misrepresentation or a material omission of

            fact which was false and known to be false by [the] defendant, made for the purpose of inducing

            the other party to rely upon it, justifiable reliance of the other party on the misrepresentation or

            material omission, and injury."' Ambac Assur. Corp. v Countrywide Home Loans, Inc., 151 AD3d

            83 at 85 [1st Dept 2017]. Further, CPLR § 3016(b) provides that when a cause of action is based

            upon fraud "the circumstances constituting the wrong shall be stated in detail."

             653730/2023 Motion No. 002                                                               Page 2 of 4

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 [FILED: NEW YORK COUNTY CLERK 04/02/2024 12:58 P~                                                  INDEX NO. 653730/2023
  NYSCEF DOC. NO. 82                                                                        RECEIVED NYSCEF: 04/02/2024

                    Recoverable damages for fraud are "out of pocket" damages, defined as damages that

            would compensate plaintiff for damages sustained as result of the fraud (Connaughton v Chipotle

            Mexican Grill, Inc., 29 NY3d 137, 143 [2017] internal citations omitted).

                    The Court finds that here, similar to the plaintiffs in Connaughton, the third-party

            complaint and counterclaims fails to specify any compensable damages from PAM' s alleged fraud.

            In opposition to PAMs motion the defendants/third-party plaintiffs contend that plaintiff and PAM

            are agents of one another and thus PAM is vicariously liable for the plaintiffs alleged fraudulent

            conduct. This argument however misses the mark and is also unsupported by specific factual

            allegations. The third-party complaint and counterclaims fail to allege a sufficient basis to pierce

            the corporate veil or any facts sufficient to support defendant/third-party plaintiffs' contention that

            any alleged fraud caused any additional damages separate and apart from those incurred by the

            alleged fraudulent conduct of plaintiff.

                    With respect to the cross-motion that seeks amendment of the third-party complaint, it is

            well established that pursuant to CPLR 3025 (b), "[a] party may amend his or her pleading, ... ,

            at any time by leave of court ... [and] [l]eave shall be freely given upon such terms as may be

           just including the granting of costs and continuances." The Court of Appeals recognizes that

            "[a]s a general rule, 'leave to amend a pleading should be freely granted in the absence of

            prejudice to the nonmoving party where the amendment is not patently lacking in merit ... , and

            the decision whether to grant leave to amend a complaint is committed to the sound discretion of

            the court."' Davis v South Nassau Communities Hosp., 26 NY3d 563,580 [2015] (internal

            citation omitted).

                    Here, the Court finds that allowing defendant/third-party plaintiffs amendment would be

            futile. The proposed amended complaint fails to cure the deficiencies cited above. Similarly, the

             653730/2023 Motion No. 002                                                             Page 3 of 4

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 !FILED: NEW YORK COUNTY CLERK 04/02/2024 12: 58 PM!                                              INDEX NO. 653730/2023
  NYSCEF DOC. NO. 82                                                                        RECEIVED NYSCEF: 04/02/2024

            Court agrees that because the third-party complaint fails to properly state a claim for an

            underlying tort there can be no conspiracy cause of action pursuant to Judiciary Law § 487 (Am.

            Preferred Prescription, Inc. v Health Mgt., 252 AD2d 414,416 [1st Dept 1998]). Accordingly, it

            is hereby

                    ORDERED that the third-party complaint is dismissed in is entirety as against

            Professional Arbitration and Mediation LLC.

                     4/2/2024
                        DATE                                                     LYLE E. FRANK, 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

             653730/2023 Motion No. 002                                                           Page4 of 4

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