Vacating an arbitration award is typically a tall order. For that reason, without a good basis for a challenge, arbitration decisions are often confirmed. A recent Second Department decision is notable not just for vacating the arbitration award but doing so because it found the award to have been irrational,…
New York Business Litigation Lawyer Blog
Loan Charging Criminal Usury Rates Supports Vacatur of Default
In what appears to be a cash advance scenario where, pursuant to a merchant agreement, the funder/lender would purchase the borrower/defendant’s future receipts for an up-front payment and not call the transaction a loan. After being sued, defaulted when it failed to respond to the lender’s lawsuit. The trial court…
Enforcing Non-Compete Provision Does Not Give Rise to Business Tort
Verizon’s employee was warned that leaving to work elsewhere would trigger the provisions of a non-compete agreement that the employee had signed. The employee left. When the new employer refused to hire this individual until and unless his dispute with Verizon was resolved, he sued Verizon for tortious interference with…
Did Bad Faith Vitiate Managing Member’s Absolute Discretion Under Parties’ Operating Agreement?
An LLC’s managing member, who had “absolute discretion” under its operating agreement to act for the LLC, was found not to have misappropriated the LLC’s corporate opportunities, to the detriment of the other member. The facts as recited by the court address the LLC’s earlier effort to invest in a…
Trivial Defect Doctrine in Trip and Fall Claim May Not Rest on Defect’s Size
Plaintiff sued Luna Park in Coney Island, alleging that she tripped and fell over a “height differential” and was injured. The park moved to dismiss arguing that the defect was trivial and created no risk to plaintiff. The Second Department affirmed the denial of that motion. The court noted that…
Strong-Arm Tactics in Threatening Litigation and Collection Precludes Injunctive Relief
In a surprising decision (to me), a Nassau County Supreme Court judge recently vacated a TRO and denied injunctive relief on an otherwise meritorious claim because plaintiff sent defendants “a series of threatening, offensive text messages which seem to imply that he was using the court to strong-arm [the defendants]…
Being “Overwhelmed by Paperwork” Is Not Fraud
Plaintiffs sued alleging fraud in connection with a deed transfer. Plaintiffs claimed that defendant induced the deed transfer by misrepresenting the nature of the documents. Plaintiffs claimed that they thought they were undertaking a short sale when they actually transferred the property outright. The lower court agreed. In reversing, the…
Alleged Mistake Insufficient to Avoid Arbitration
The parties agreed to arbitrate plaintiff’s action for personal injuries arising from a car accident. Prior to agreeing to arbitrate, defendant’s insurance carrier informed plaintiff’s counsel that the policy bodily injury limits were 100,000/300,000. The arbitration agreement included a high-low provision that would restrict any award to an amount of…
Lawsuit Against Online Reviewer Deemed Anti-SLAPP Suit
The patient of a plastic surgeon posted negative reviews on multiple review sites. The doctor filed suit, alleging a number of claims. The poster moved to dismiss and sought damages under what is commonly called New York’s anti-SLAPP law. Before agreeing, the First Department provided some background to this law:…
Supreme Court: Arbitration Agreements Are Treated like Contracts
As outlined by the United States Supreme Court, the petitioner, Robyn Morgan, worked at a Taco Bell franchise owned by respondent Sundance. When applying for a job, Morgan signed an agreement to arbitrate any employment dispute. Despite that agreement, Morgan filed a class action asserting that Sundance had violated federal…