Family Matter in Jay Snyder v. Lvh Global, Inc.,, Amir Benesh, Hugh Barton| Trellis.Law

On February 26, 2019 a Motion-Secondary was filed involving a dispute between Jay Snyder, and Amir Benesh, Hugh Barton, Lvh Global, Inc.,, for Commercial - Contract in the District Court of New York County.

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FILED: ALBANY COUNTY CLERK 05/29/2024 04:46 PM INDEX NO. 907530-23
NYSCEF DOC. NO. 177 RECEIVED NYSCEF: 05/29/2024

SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF ALBANY
DOWNSTATE AT LICH HOLDING COMPANY,
INC.,

Plaintiff,
Index No. 907530/2023
vs.

FORTIS PROPERTY GROUP, LLC,

Defendant.

FORTIS PROPERTY GROUP, LLC and FPG Cobble
Hill Acquisitions, LLC,

Counterclaim Plaintiffs,

vs.

DOWNSTATE AT LICH HOLDING COMPANY,
INC.,

Counterclaim Defendant,

and

NYU HOSPITALS CENTER,
Counterclaim Defendant.

FORTIS PROPERTY GROUP, LLC AND FPG COBBLE HILL ACQUISITIONS, LLC’S
OPPOSITION TO DOWNSTATE AT LICH HOLDING COMPANY, INC.’S
MOTION TO REARGUE

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TABLE OF CONTENTS

TABLE OF AUTHORITIES .......................................................................................................... ii
PRELIMINARY STATEMENT .................................................................................................... 1
ARGUMENT .................................................................................................................................. 2
I. SELLER DID NOT RAISE THIS ARGUMENT IN ITS ORIGINAL MOTION
PAPERS. ..................................................................................................................................... 2
II. THIS COURT IMPLICITLY REJECTED SELLER’S CONTENTION THAT
FORTIS’S REQUEST FOR CREDITS CONSTITUTED A REPUDIATION,
EXCUSING SELLER OF ITS DUTY TO TENDER THE PREMISES IN GOOD
ORDER. ...................................................................................................................................... 4
III. SELLER FAILED TO COMPLY WITH THE CONDITION PRECEDENT
BEFORE ANY PURPORTED REPUDIATION, THEREFORE ANY PURPORTED
REPUDIATION WOULD NOT ABSOLVE SELLER OF ITS OBLIGATION. ...................... 4
IV. FORTIS’S CLAIM FOR CREDITS DOES NOT RELIEVE SELLER OF ITS
DUTY TO BE READY WILLING AND ABLE TO PERFORM. ............................................ 6
V. FORTIS DID NOT REPUDIATE THE CONTRACT. ...................................................... 8
VI. THIS COURT DECLINED TO ADDRESS FORTIS’S AFFIRMATIVE
DEFENSE THAT THE GUARANTEE WAS PROCURED BY FRAUD. ............................. 10
VII. THE COURT SHOULD DEFER A RULING ON THE MOTION PENDING
BRIEFING AS PREVIOUSLY REQUESTED BY THE COURT'S ORDER. ........................ 12
CONCLUSION ............................................................................................................................. 12

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TABLE OF AUTHORITIES

Cases Page(s)

159 MP Corp. v. Redbridge Bedford, LLC,
33 N.Y.3d 353 (2019) .................................................................................................................. 9

Am. Trading Co. v. Fish,
42 N.Y.2d 20 (1977) .................................................................................................................. 11

Ampower-US, LLC v. WEG Transformers USA, LLC,
214 A.D.3d 1129 (3d Dep’t 2023) ............................................................................................... 6

BWA Corp. v. Alltrans Express U.S.A., Inc.,
112 A.D.2d 850 (1st Dep’t 1985) ................................................................................................ 9

Donerail Corp. N.V. v. 405 Park LLC,
100 A.D.3d 131 (1st Dep’t 2012) ................................................................................................ 7

IBM Credit Fin. Corp. v. Mazda Motor Mfg. (USA) Corp.,
92 N.Y.2d 989 (1998) .................................................................................................................. 9

Inter-Power of New York Inc. v. Niagara Mohawk Power Corp.,
259 A.D.2d 932 (3rd Dep’t 1999) ............................................................................................... 6

Lieberman Props., Inc. v. Braunstein,
134 A.D.2d 55 (2d Dep’t 1987) ................................................................................................... 6

Madison Invs., Inc. v. Cohoes Assocs.,
176 A.D.2d 1021 (3d Dep’t 1991) ............................................................................................... 6

McGill v. Goldman,
261 A.D.2d 593 (2d Dep’t 1999) ................................................................................................. 4

Meltzer v. G.B.G., Inc.,
176 A.D.2d 687 (1st Dep’t 1991) ................................................................................................ 9

Morrissey v. Nextel Partners, Inc.,
22 Misc. 3d 1124(A), 880 N.Y.S.2d 874 (Sup. Ct. Albany Cnty. 2009) .................................. 10

Nielsen Co. (US), LLC v. Success Sys., Inc.,
2013 WL 1197857 (S.D.N.Y. Mar. 19, 2013) ........................................................................... 11

Pastor v. DeGaetano,
128 A.D.3d 218 (1st Dep’t 2015) ................................................................................................ 7

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Peak v. Northway Travel Trailers,
260 A.D.2d 840 (3d Dep’t 1999) ................................................................................................. 4

Princes Point LLC v. Muss Dev. L.L.C.,
138 A.D.3d 112 (1st Dep’t 2016) ................................................................................................ 5

Regal Jewelry & Gift Shop LLC v. Klein,
72 Misc. 3d 1217(A), 150 N.Y.S.3d 893 (N.Y. Sup. Ct. NY Cnty. 2021)................................ 12

Ross Bicycles, Inc. v. Citibank, N.A.,
200 A.D.2d 379 (1st Dep’t 1994) ................................................................................................ 6

SPI Commc'ns, Inc. v. WTZA-TV Assocs. Ltd. P'ship,
229 A.D.2d 644 (3d Dep’t 1996) ................................................................................................. 8

Weaver v. Weaver,
198 A.D.3d 1140 (3d Dep’t 2021) ............................................................................................. 12

Rules

CPLR 213...................................................................................................................................... 11

CPLR 2221...................................................................................................................................... 4

iii

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Defendant Fortis Property Group, LLC and counterclaim Plaintiffs Fortis Property Group

LLC and FPG Cobble Hill Acquisitions LLC (hereafter, collectively “Fortis”) submit this

Memorandum of Law in Opposition to Plaintiff and counterclaim Defendant Downstate at LICH

Holding Company, Inc. (“Seller”)’s Motion to Reargue (NYSCEF Nos. 155-157).

PRELIMINARY STATEMENT

On April 25, 2024, this Court issued a forty-four-page decision and order (“Order”)

addressing the parties’ numerous dispositive motions and cross-motions. See NYSCEF No. 148.

Despite this, Seller claims that this Court somehow failed to address its argument that, because

Fortis’s request for credits was barred by the disclaimers in the parties’ Modified Purchase and

Sales Agreement (PSA) and Waiver, Fortis’s request for those credits constituted a repudiation

of—and therefore a default under—the PSA, relieving seller of the obligation to tender the

premises in good order. A holding that Fortis repudiated and defaulted under the agreement would,

according to Seller: 1) establish summary judgment in its favor on the guarantee by obviating

Fortis’ affirmative defense that it failed to satisfy the condition precedent for closing of vacating

the premises in good order; and 2) compel dismissal of Fortis’ counterclaim I seeking a declaration

of no default.

Seller’s arguments fail on several fronts. First, Seller never made this argument in its

original motion papers. Second, this Court implicitly found that Fortis’s request for credits did not

amount to a repudiation because it specifically held that Fortis’s affirmative defense based on the

unsatisfied condition precedent raised questions of fact. Third, even if Fortis did repudiate, Seller

would not be absolved of its failure to satisfy the condition precedent, as this failure occurred prior

to the purported repudiation. Fourth, even if Fortis did make a legally erroneous request for credits,

Seller was still required to establish that it was ready, willing, and able to perform when it noticed

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closing to recover for breach, which it could not do. Fifth, Fortis did not repudiate, and this Court

implicitly addressed and rejected Seller’s repudiation theory in its Order. These contested issues

as to the existence of default prevent summary judgment in Seller’s favor on the guarantee and on

its request for dismissal of counterclaim I.

Seller also seeks reargument with regard to Fortis’s counterclaim III insofar as it alleges

that Seller fraudulently induced Fortis to sign the guarantee. Seller claims that, because this Court

rejected Fortis’s claim for credits, it necessarily must also hold that the guarantee could not have

been fraudulently induced. However, Fortis’s argument with regard to fraudulent inducement of

the guarantee rests on different legal grounds than its claim for credits, and this Court declined to

address the former argument in its Order. Thus, it does not follow that dismissal of Fortis’s claim

for credits requires dismissal of Fortis’s claim of fraudulent inducement of the guarantee.

Lastly and separately, this Court should defer deciding the issues raised in this motion

unless or until it receives briefing from Seller as expressly requested by this Court in its previous

Order.

ARGUMENT

I. SELLER DID NOT RAISE THIS ARGUMENT IN ITS ORIGINAL MOTION
PAPERS.

Seller argues that because Fortis had raised the issue of credits to be applied to the purchase

price and because this Court subsequently held that Fortis’s request was barred by certain

contractual language, this Court should have held that Fortis’s request for the promised credits

constituted a repudiation, releasing Seller of its obligation to tender the premises in good order.

See Seller’s Memorandum of Law in Support of Its Motion For Leave to Reargue, NYSCEF Doc.

No. 156 at 3 (“[I]f Purchaser is not contractually entitled to the demanded credits, then Purchaser’s

acts constitute repudiation of the [parties’ agreement], triggering the payment obligation

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thereunder”) (citing Seller’s Reply Memorandum of Law in Support of its Motion for Summary

Judgment on the Guarantee NYSCEF Doc. No. 87 at 6). Further, according to this theory, Fortis’s

supposed repudiation absolved Seller of its obligations to meet the conditions precedent for closing

and—with Fortis’s affirmative defense based on Seller’s failure to vacate the premises in good

order having fallen away—should have enabled entry of summary judgment in Seller’s favor on

the guarantee.

Seller failed to raise this argument in its original moving papers. Prior to its Memorandum

of Law in Support of its Motion for Reargument, Seller never raised the specific theory that Fortis’s

supposed repudiation-by-request-for-credits relieved Seller of its specific obligation to vacate the

premises in good order. The closest Seller gets is its recitation of the general proposition that “[i]n

the real estate context, the purchaser asserting an untenable interpretation, or insisting on an

extracontractual condition, constitutes an immediate default and relieves the seller from its

obligation to proceed with closing.” Seller’s Reply Memorandum of Law in Further Support of

its Motion for Summary Judgment on the Guarantee, NYSCEF Doc. No. 38 at 13.

But Seller’s general reference to being relieved of the “obligation to proceed with closing”

cannot be read as a specific reference to the obligation to vacate the premises in good order. It

would have been easy for Seller to raise this latter argument in response to Fortis’s affirmative

defense expressly raising Seller’s failure to vacate the premises in good order. Instead, Seller

urged this Court to dismiss Fortis’s affirmative defense for two different reasons: 1) that the interim

sublease was satisfied by NYUHC leaving the premises by the sublease’s end date; and 2) that the

premises were in fact tendered in good order. Nowhere did Seller raise the argument that it was

relieved of its duty to satisfy the condition precedent on account of Fortis’s purported repudiation.

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It is a well-established principle that reargument is “not designed to provide an

unsuccessful party . . . [the opportunity] to present arguments different from those originally

presented.” McGill v. Goldman, 261 A.D.2d 593, 594 (2d Dep’t 1999). Therefore, Seller’s

argument that it was relieved of its duty to satisfy the condition precedent on account of Fortis’s

purported reputation—raised for the first time in the context of reargument—fails. If Seller had

made the specific argument as to the repudiation absolving Seller of its obligation to vacate the

premises in good order then that argument would appear in its original moving papers; but it does

not.

II. THIS COURT IMPLICITLY REJECTED SELLER’S CONTENTION THAT
FORTIS’S REQUEST FOR CREDITS CONSTITUTED A REPUDIATION,
EXCUSING SELLER OF ITS DUTY TO TENDER THE PREMISES IN GOOD
ORDER.

This Court did not “overlook[] or misapprehend[]” Seller’s argument that its duty to tender

the premises in good order was excused. Peak v. Northway Travel Trailers, 260 A.D.2d 840, 842

(3d Dep’t 1999) (“[A] motion for leave to reargue pursuant to CPLR 2221 . . . is properly granted

upon a showing that the court overlooked or misapprehended the facts and/or the law or mistakenly

arrived at its earlier decision.”). When this Court upheld Fortis’s affirmative defense that the

premises were not tendered in good order, it clearly believed that such an obligation survived—

and remained unaltered by—Fortis’s claim for credits. If this Court instead believed that the

request for credits somehow absolved Seller of its duty, it presumably would have so held. Thus,

in its Order, this Court implicitly rejected the theory that Seller now wishes to advance.

III. SELLER FAILED TO COMPLY WITH THE CONDITION PRECEDENT
BEFORE ANY PURPORTED REPUDIATION, THEREFORE ANY
PURPORTED REPUDIATION WOULD NOT ABSOLVE SELLER OF ITS
OBLIGATION.

Even if Fortis repudiated by requesting the promised credits, Seller’s obligation to vacate

the premises in good order was not thereby obviated, as Fortis raised the issue of Seller’s failure

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to vacate the premises in good order well before Fortis ever raised the issue of credits, and Seller

refused to remedy the condition. Fortis raised this issue on June 19, 2023. See Ex. 1 to Affirmation

of George F. Carpinello Dated May 29, 2024 (Letter from Fortis to Seller dated June 19, 2023, at

2) (“Seller alleged that the condition for closing stated in PSA § 4.2(e)(vii) was satisfied, but this

is not true. NYUHC has not yet vacated the Interim Medical Premises pursuant to the terms of the

Interim Sublease.”), and later raised the issue of credits—and reiterated its position as to the

condition of the premises—at a subsequent meeting on August 8, 2023. See Ex. 2 to Affirmation

of George F. Carpinello Dated May 29, 2024 (Transcript of Meeting dated August 8, 2023, at 2);

id. at 2-3 (“That closing condition has not been met. That’s because NYU was required to vacate

the premises, leaving those premises in good order. It did not do so. It left holes in the floor, holes

in the wall, and the overall premises were left in a very bad state of disrepair.”). Again, Seller

refused to remedy the condition.

This sequence of events is critical to the disposition of the instant motion. Even assuming

a repudiation occurred, while a plaintiff buyer’s “anticipatory breach [may] discharge [a]

defendant [seller’s] future obligations (including to fulfill conditions precedent) under [a]

contract,” Princes Point LLC v. Muss Dev. L.L.C., 138 A.D.3d 112, 118 (1st Dep’t 2016)

(emphasis added) (abrogated on other grounds), the defendant seller’s liability for breaches and

unsatisfied condition precedents that occur prior to the purported repudiation remains unaltered.

Seller cannot absolve itself of its obligation to come to the closing with all its conditions precedent

met merely because Fortis subsequently raised the issue of entitlement to certain credits, and

merely because this Court ultimately held that Fortis was not entitled to those credits. Therefore,

Seller’s liability with respect to its failure to vacate the premises in good order was not discharged,

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and Fortis may permissibly invoke this unsatisfied condition precedent as an affirmative defense

to summary judgment on the guarantee.

IV. FORTIS’S CLAIM FOR CREDITS DOES NOT RELIEVE SELLER OF ITS
DUTY TO BE READY WILLING AND ABLE TO PERFORM.

It is a well-established principle of New York law that “while an anticipatory breach

relieves the nonbreaching party of the need to tender performance, such party nonetheless is

required to show that it was ready, willing and able to perform its obligations under the contract.”

Inter-Power of New York Inc. v. Niagara Mohawk Power Corp., 259 A.D.2d 932, 934 (3rd Dep’t

1999); see also Ross Bicycles, Inc. v. Citibank, N.A., 200 A.D.2d 379, 380 (1st Dep’t 1994) (“Ross

Bicycles, to establish damages, must show that, but for Citibank’s wrongful repudiation, it would

have been ready, willing and able to fulfill its obligations under the contract.”); Lieberman Props.,

Inc. v. Braunstein, 134 A.D.2d 55, 60 (2d Dep’t 1987) (“Thus, the plaintiff’s entitlement to specific

performance must still be conditioned upon its obtaining approval from the board. As long as the

plaintiff seeks specific performance, it may not be relieved from complying with the condition

precedent, even though the defendants attempted to repudiate the contract”); Madison Invs., Inc.

v. Cohoes Assocs., 176 A.D.2d 1021, 1022 (3d Dep’t 1991) (holding that where the plaintiff buyer

of real estate “contend[ed] essentially that [the] defendants breached the contract by entering into

leases in violation of [the contract] thus excusing [the plaintiff’s] duty to tender performance. . . .

[the] plaintiff was nevertheless required to show that it was ready, willing and able to perform

under the contract at some point prior to the commencement of this action”); Ampower-US, LLC

v. WEG Transformers USA, LLC, 214 A.D.3d 1129 (3d Dep’t 2023) (“There is no evidence in the

record that [the] defendants repudiated the contract before the specified closing date and, even if

[the] plaintiff could demonstrate an anticipatory breach, [the] plaintiff did not establish that it was

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ready, willing and able to perform by virtue of failing to satisfy its conditions precedent on or

before the specified closing date.”).

The principle that a seller must establish that it is otherwise “ready, willing and able” to

fulfill its obligations under the contract applies with equal force when a buyer repudiates and when

a seller has failed to satisfy some condition precedent by the time of closing. See e.g., Pastor v.

DeGaetano, 128 A.D.3d 218, 222, 220, 224 (1st Dep’t 2015) (holding that even where the plaintiff

buyer of real estate “cancel[ed] the Contract of Sale,” the defendant seller could not force the buyer

to “conclude the purchase” of the property, because—by the time of closing—the defendant failed

to satisfy the condition precedent of obtaining from the building’s cooperative board assurances

that the plaintiff would have the “right to exclusively use the terrace” and that this right would not

be “abrogate[d] in the future”); Donerail Corp. N.V. v. 405 Park LLC, 100 A.D.3d 131, 138 (1st

Dep’t 2012) (“Thus, where a seller seeks to hold a purchaser in breach of contract, the seller must

establish that it was ready, willing, and able to perform on the time-of-the-essence closing date,

and that the purchaser failed to demonstrate a lawful excuse for its failure to close.”).

Common sense also points to the reality that Fortis’s request for credits in no way absolved

Seller of its obligation to vacate the premises in good order. Consider the example of a buyer who

enters a contract to purchase a newly constructed house, with a condition that the house’s roof be

completed and stable by closing. At closing, the buyer urges that it is entitled to credits that the

seller orally promised. Also at closing, the roof—despite the buyer’s repeated inquiries and

complaints—remains incomplete, and the seller expresses its unwillingness and inability to finish

the construction. Even if the buyer’s request for credits is ultimately deemed to be in error or

otherwise barred by the parties’ contract, this would in no way absolve the seller of its contractual

obligation to furnish a completed and stable roof for the buyer.

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As with this hypothetical seller, Seller here manifestly failed to establish that it was “ready,

willing and able” to perform at closing, as it failed to satisfy the condition precedent of vacating

the premises in good order—or at least this Court held that there exists a triable issue of fact on

that issue. See NYSCEF Doc. No. 148 at 34-36. As a result, even if Fortis repudiated, Fortis’s

affirmative defense on the basis that Seller failed to vacate the premises in good order remains

viable, and reargument on Seller’s motion for summary judgment on the guarantee is not

warranted.

Similar logic dictates that Seller be denied leave to reargue its motion to dismiss

counterclaim I, which seeks a declaration that Fortis is not in default. Even if Fortis repudiated,

because Fortis established the existence of issues of fact as to whether Seller failed to vacate the

premises in good order, Fortis’s affirmative defense on that basis remains viable. In turn, there

remain issues of fact as to whether default has occurred, and the request for a declaration as to that

issue remains live.

V. FORTIS DID NOT REPUDIATE THE CONTRACT.

Fortis did not repudiate the PSA by requesting the promised credits. Although

“anticipatory repudiation . . . can be grounded upon a finding that [a] party has attempted to avoid

its obligations by advancing an ‘untenable’ interpretation of the contract or has communicated its

intent to perform only upon the satisfaction of extracontractual conditions,” SPI Commc'ns, Inc. v.

WTZA-TV Assocs. Ltd. P'ship, 229 A.D.2d 644 (3d Dep’t 1996), this Court implicitly rejected

Seller’s repudiation theory in its Order. Nowhere in that Order did this Court suggest Fortis’s

request for credits was either “untenable” or “extracontractual.”

The request was not untenable because Fortis presented a viable argument that, despite the

disclaimers in the parties’ PSA and Waiver, Malatras’s oral promises still constituted an

“instrument” that was “part of the same transaction” as the formal, written agreements, and
8

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therefore had to “be interpreted together” with them. See NYSCEF Doc. No. 148 at 19-20 (citing

BWA Corp. v. Alltrans Express U.S.A., Inc., 112 A.D.2d 850, 852 (1st Dep’t 1985)). Although

this Court disagreed with Fortis’s argument, it did not specifically hold that the argument was

untenable—a necessary step for a finding of anticipatory repudiation on this basis. See e.g., IBM

Credit Fin. Corp. v. Mazda Motor Mfg. (USA) Corp., 92 N.Y.2d 989, 993 (1998) (noting that “the

courts below found that IBM Credit's interpretation of the agreement . . . was untenable. The

untenability of this contract interpretation [wa]s not contested by IBM Credit on th[e] appeal.”);

Meltzer v. G.B.G., Inc., 176 A.D.2d 687, 688-89 (1st Dep’t 1991) (holding that cause of action

“alleging an anticipatory breach of [a] sales contract . . . was defectively pleaded and should have

been dismissed as a matter of law” where “[t]hat cause of action did not allege that the defendants’

construction of the contract . . . [was] ‘untenable,’” which suggests a difference in proof required

to plead on the one hand that an opponent’s proffered contract interpretation is incorrect, and on

the other that an opponent’s proffered contract interpretation is “untenable”).

It cannot be that whenever a proffered contract interpretation is ultimately rejected by a

court that the interpretation becomes ipso facto untenable. Otherwise, all contracting parties—

especially parties to complex commercial transactions governed by contracts that often have

numerous ambiguous provisions—run the risk of having all their negotiating positions later

deemed acts of repudiation. Such an outcome would undercut New York State’s public policy

favoring freedom of contract. Cf. 159 MP Corp. v. Redbridge Bedford, LLC, 33 N.Y.3d 353, 359-

60 (2019) (“By disfavoring judicial upending of the balance struck at the conclusion of the parties’

negotiations, our public policy in favor of freedom of contract both promotes certainty and

predictability and respects the autonomy of commercial parties in ordering their own business

arrangements.”).

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The request for credits was likewise not extracontractual because Fortis’s entire theory

was that Malatras’s oral promise was internal to the contract, i.e.: the oral promise for credits had

to be interpreted together with the parties’ written documents, and it therefore constituted a valid

component of the contract. As with untenability, it cannot be that whenever a court ultimately

deems that an oral promise is barred by a merger clause, a party’s prior attempt to hold the promisor

to their word is transformed into an impermissible ploy to bind a counterparty to an

extracontractual condition. Again, this would undermine the autonomy of commercial parties in

negotiating and “in ordering their own business arrangements,” id., as it is not always clear whether

oral or written agreements that are ancillary to primary written documents setting forth agreements

between parties are barred by merger clauses contained within the primary documents. See e.g.,

Morrissey v. Nextel Partners, Inc., 22 Misc. 3d 1124(A), 880 N.Y.S.2d 874 (Sup. Ct. Albany Cnty.

2009) (holding that a “contemporaneous[]” agreement entered by the parties that referred to the

main agreement could be introduced into evidence despite presence of a “merger clause” in the

primary written agreement).

VI. THIS COURT DECLINED TO ADDRESS FORTIS’S AFFIRMATIVE
DEFENSE THAT THE GUARANTEE WAS PROCURED BY FRAUD.

Seller also asks for reargument of its contention that Fortis’s counterclaim III should have

been dismissed insofar as Fortis claims the guarantee was fraudulently induced. Seller argues that

this Court’s rejection of Fortis’s request for credits implicitly required dismissal of Fortis’s claim

that the guarantee was fraudulently induced. This is incorrect: While this Court did reject Fortis’s

claim that it could enforce the separate promises made by Malatras, this Court did not address

Fortis’s separate and wholly independent claim that the guarantee itself was fraudulently induced.

And this Court’s consideration of fraudulent inducement claims with respect to the PSA would not

subsume those same arguments with respect to the guarantee, as they are separate contractual

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instruments, and guarantees are presumptively treated as separate instruments from underlying

contracts for sale under New York law. See e.g., Am. Trading Co. v. Fish, 42 N.Y.2d 20, 26-27

(1977) (holding that the “appropriate Statute of Limitations with respect to defendant's guarantee

. . . [was the] six-year period applicable to contracts generally under CPLR 213,” and not the statute

of limitations contained within the Uniform Commercial Code, as the “defendant's guarantee was

an undertaking separate from the sales arrangement itself”). Seller does not point to anything in

the parties’ contract that rebuts this presumption.

In its motion papers Fortis argued that the boilerplate merger provisions contained within

the guarantee could not obviate a claim for fraudulent inducement of that same document because

Seller’s specific inducements were not expressly disclaimed in the guarantee. See NYSCEF Doc.

No. 71 at 17-19; see also Nielsen Co. (US), LLC v. Success Sys., Inc., No. 11 CV 2939, 2013 WL

1197857, at *8 (S.D.N.Y. Mar. 19, 2013) (“In order to be considered sufficiently specific to bar a

party’s claim for fraud in the inducement, the contract language must contain explicit disclaimers

of the particular representations that form the basis of the fraud-in-the inducement claim.”)

(citations and internal quotations omitted).

This Court did not address that argument, apparently believing that it was not necessary to

do so since it had already declined to grant the parties’ cross motions for summary judgment as to

an important component of counterclaim III: that Seller had failed to obtain the necessary

signatures of the Attorney General and the Comptroller of the State of New York. See NYSCEF

Doc. No. 80 at ¶ 124. Declining to address this argument was well within this Court’s discretion.

However, should this Court now find it necessary to address this portion of counterclaim III, it

should hold that the guarantee was in fact fraudulently induced for the reasons set forth in Fortis’s

motion papers. See NYSCEF Doc. No. 71 at 16-19. Beyond that, as this Court did not otherwise

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“overlook[] . . . the facts and/or law” in “arriv[ing] at its earlier decision,” Weaver v. Weaver, 198

A.D.3d 1140, 1143 (3d Dep’t 2021), reargument is not warranted.

VII. THIS COURT SHOULD DEFER A RULING ON THE MOTION PENDING
BRIEFING AS PREVIOUSLY REQUESTED BY THIS COURT'S ORDER.

Although Seller was required to make its motion to reargue within 30 days of the entry of

this Court's order, this Court is under no obligation to decide the issues raised in this motion prior

to briefing on the issue of Fortis’s revocation of the guarantee, as expressly requested by this Court

in its previous order. Fortis’s counsel previously urged that Seller’s counsel request such deferral

pending briefing on the related issues, but Seller’s counsel refused to do so. If this Court agrees

with Fortis that the guarantee was not timely approved by the state attorney general and

comptroller, then the guarantee is null and void, and Seller’s motion is moot. See Regal Jewelry &

Gift Shop LLC v. Klein, 72 Misc. 3d 1217(A), 150 N.Y.S.3d 893, 1-2 (N.Y. Sup. Ct. NY Cnty.

2021) (when the trial court became “aware of [a] bankruptcy court decision” “on questions related

to th[e] matter,” leave for reargument was granted only after the trial “court sought letter briefing

from the parties on whether and how the [related bankruptcy court] decision should affect the

[trial] court's consideration of the pending reargument motion,” and only after the “parties . . . filed

briefs on th[e] issue”).

CONCLUSION

For the foregoing reasons, Seller’s motion to reargue should be denied.

Dated: Albany, New York Respectfully submitted,
May 29, 2024 By: /s/ George F. Carpinello
George F. Carpinello
Jenna C. Smith
BOIES SCHILLER FLEXNER LLP
30 South Pearl Street, 12th Floor
Albany, NY 12207
Tel.: (518) 434-0600

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Fax: (518) 434-0665
Email: gcarpinello@bsfllp.com
Email: jsmith@bsfllp.com

Katherine Cassirer
Max Hyams
BOIES SCHILLER FLEXNER LLP
55 Hudson Yards, 20th Floor
New York, NY 10001
Tel.: (212) 446-2300
Fax: (212) 446-2350
Email: kcassirer@bsfllp.com
Email: mhyams@bsfllp.com

Attorneys for Defendant/Counterclaim Plaintiff
Fortis Property Group, LLC and Counterclaim
Plaintiff FPG Cobble Hill Acquisitions, LLC

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CERTIFICATION

I, George F. Carpinello, certify pursuant to Rule 17 of the Rules of Practice for the

Commercial Division that the foregoing brief in opposition to Plaintiff and counterclaim

Defendant Downstate at LICH Holding Company, Inc’s Motion to Reargue contains no more than

7,000 words, excluding tables of contents and authorities, the caption, and signature block.

Dated: May 29, 2024 /s/ George F. Carpinello
George F. Carpinello

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Case Info

Judge

Lyle E. Frank Track Judge’s New Case

Case No.

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Document Filed Date

May 29, 2024

Case Filing Date

February 26, 2019

County

Parties

Amir Benesh Defendant
DRANOFF, ERIC Attorney for the Plaintiff
GORODETSKY, MICHAEL ALEXANDER Attorney for the Defendant
Hugh Barton Defendant
HUGHES, MATTHEW RYAN Attorney for the Plaintiff
Jay Snyder Plaintiff
LVH GLOBAL, INC., Defendant
REIFF, SIMON W. Attorney for the Defendant
REIFF, SIMON W. Attorney for the Defendants
WEISSMAN, ROBERT BENJAMIN Attorney for the Plaintiff
STEVEN ISSER Attorneys for Plaintiffs
DEBORAH ISSER Attorney

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Motion-Secondary: Jay Snyder v. Lvh Global, Inc.,, Amir Benesh, Hugh Barton

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