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At IAS Part 54, of the Supreme Court of
the State of New York, County of New
York, at _the Courthouse, 60 Centre
Street, New York, New York, on the
day of August, 2014.
PRESENT:
HON. SHIRLEY WERNER KORNREICH,
Justice
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HARVEY RUDMAN and HAROLD KUPLESKY,
on behalf of Each of Them Individually And
On Behalf of Starrett City Preservation LLC,
Derivatively,
Plaintiffs, Index No. 650159/10
-against-
CAROL GRAM DEANE, THE ESTATE OF (PROPOSED) COUNTERORDER,
DISQUE D. DEANE by CAROL G. DEANE, DECLARATION AND JUDGMENT
AS TEMPORARY EXECUTRIX, SALT ON MOTION FOR PARTIAL
KETTLE LLC, ST. GERVAIS LLC, STARRETT SUMMARY JUDGMENT
CITY PRESERVATION LLC, DD SPRING
CREEK LLC, SK SPRING CREEK
LLC, SPRING CREEK PLAZA LLC, DD
SHOPPING CENTER LLC and SK SHOPPING
CENTER LLC,
Defendants.
Defendants having moved pursuant to CPLR 3212 for partial summary judgment as to
plaintiffs' Second Amended Complaint for the following relief:
a. Dismissal of plaintiffs' Ninth Cause of Action which seeks a judgment declaring
that the Managing Member of Preservation cannot reduce plaintiffs' Sharing
Ratios pursuant to Section 3.3 of the Preservation Agreement ("the Agreement")
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prior to what plaintiffs have characterized as a "full distribution of the
MGP/SKI's share of the Refinancing Proceeds";
b. A ruling that the Managing Member of Starrett City Preservation LLC
("Preservation") was authorized by Section 4.2(iii) of the Agreement to award
bonuses to three members of the office staff, as she did, and to create a reserve for
future office staff bonuses;
c. A ruling that plaintiff Kuplesky's Sharing Ratio was properly reduced pursuant to
Section 5.5 of the Agreement; and
Defendants having submitted by electronic filing the following moving papers in support
of their motion: (a) Notice of Motion, dated July 3, 2013; (b) Affirmation of Kenneth E. Warner,
Esq., affirmed July 3, 2013, and the exhibits annexed thereto; (c) the parties' Joint Statement of
Undisputed Material Facts, dated July 3, 2013; and (d) Defendants' Corrected Memorandum of
Law in Support of Motion for Summary Judgment, dated July 3, 2013 (electronically filed on
October 23, 2014); and
Plaintiffs having opposed defendants' motion for partial summary judgment and having
submitted the following papers in opposition: (a) Corrected Affirmation of Jacqueline Veit, Esq.,
affirmed August 14, 2013, with exhibits annexed thereto (electronically filed on August 23,
2013); and (b) plaintiffs' Corrected Memorandum of Law in Opposition to Defendants' Motion
for Partial Summary Judgment, dated August 14, 2013 (electronically filed on August 23, 2013);
and
Defendants having submitted the following reply papers in further support of said
motion: (a) Corrected Reply Affirmation of Kenneth E. Warner, Esq., affirmed October 1, 2013,
and the exhibits annexed thereto (electronically filed on October 3, 2013); and (b) Defendants'
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Corrected Reply Memorandum of Law in Support of Motion for Partial Summary Judgment,
dated October 1, 2013 (electronically filed on October 3, 2013); and
The Court having heard oral argument on December 10, 2013, and a transcript of the
oral argument having been made and filed; and
The Court, by Order dated March 27, 2014, having requested the parties to submit
supplemental briefing and the parties having made such supplemental submissions by,
respectively, letters from plaintiffs dated Apri14, 2014, April 8, 2014 and April 11, 2014, and
from defendants dated Apri14, 2014, April 11, 2014 and April 15, 2014; and
The Court having read all of the foregoing submissions and arguments, and due
deliberation by the Court having been had thereon, and the Court having issued a written
Decision, Order &Judgment dated July 28, 2014; it is hereby
ORDERED that defendants' motion for partial summary judgment against plaintiffs is
granted in part, and the First through Eighth Causes of Action are dismissed, to the extent they
claim that the sums awarded as bonuses by Preservation to Iris Sutz, Robert Poll and Curt Deane
or set aside for future bonus payments were unauthorized or improper under the Agreement; and
it is further
ADJUDGED AND DECLARED that on plaintiffs' Ninth Cause of Action that pursuant
to Section 3.3 of the Agreement, the Managing Member of Preservation has the power to
reallocate the Sharing Ratios of any Member of Preservation once (i) SCA or its successors has
distributed to Preservation all distributions it is required to make to its Managing General Partner
and General Partner under Sections 3.02 and 3.03 of the SCA Partnership Agreement; (ii)
Preservation has distributed to its Members, in accordance with Section 4.2 of the Agreement (as
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to which the Court has determined that the word "payments" in Section 4.2 of the Agreement
refers to Plaintiffs' share of "cash distributions"), any and all distributions it received from SCA;
and (iii) such distributions by Preservation are $10 million or more, in the aggregate; and it is
further
ORDERED that the first through eighth causes of action are severed and shall continue;
and it is further
ORDERED that Defendants' motion is otherwise denied.
ENTER:
Shirley Werner Kornreich, J.S.C.
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