Jackie's Enters., Inc. v. Belleville

• Decision Date: 25 October 2018
• Docket Number: 526237
• Citation: Jackie's Enters., Inc. v. Belleville, 165 A.D.3d 1567, 87 N.Y.S.3d 124 (N.Y. App. Div. 2018)
• Parties: JACKIE'S ENTERPRISES, INC., Appellant, v. Rosa BELLEVILLE et al., Respondents.
• Court: New York Supreme Court — Appellate Division

165 A.D.3d 1567

87 N.Y.S.3d 124

JACKIE'S ENTERPRISES, INC., Appellant,

v.Rosa BELLEVILLE et al., Respondents.

526237

Supreme Court, Appellate Division, Third Department, New York.

Calendar Date: September 5, 2018

Decided and Entered: October 25, 2018

Corbally, Gartland & Rappleyea, LLP, Poughkeepsie (Kyle C. Van De Water of counsel), for appellant.

Nolan & Heller, LLP, Albany (Brendan J. Carosi of counsel), for respondents.

Before: McCarthy, J.P., Lynch, Clark, Mulvey and Rumsey, JJ.

MEMORANDUM AND ORDER

McCarthy, J.P.

Appeal from an order of the Supreme Court (Platkin, J.), entered April 14, 2017 in Albany County, which, among other things, granted defendants' motion for summary judgment dismissing the complaint.

Defendant Rosa Belleville (hereinafter Belleville) is the president and sole shareholder of Mme. Pirie's, Inc., a corporation that previously owned and operated Madame Pirie's Famise Corset and Lingerie Shop (hereinafter the shop), a women's undergarment store located in the City of Albany. Defendant William Belleville is her husband and co-owner of the building in which the shop is located. Defendant Michael Belleville is their son. In January 2014, Mme. Pirie's and Belleville entered into a purchase and sale agreement with Keto Ventures, LLC, a corporation formed by Jessica Keto for such purpose, whereby Keto Ventures purchased the shop, including certain equipment and inventory. Keto Ventures and Jessica Keto, individually, executed a promissory note in favor of Belleville, a commercial lease agreement with Belleville and William Belleville to continue operating in the same space, and a security agreement granting Belleville a security interest in "all inventory, goods, equipment, appliances, furnishings, and fixtures [then] or [thereafter] placed upon the [the shop's] premises or used in connection therewith" and any "trademarks, trade names, contract rights, and leasehold interests" therein (hereinafter the collateral).

Following Jessica Keto's death in March 2014, her sister, Jacklyn Keto (hereinafter Keto), took over management of the shop. Soon thereafter, Keto Ventures failed to make several payments under the promissory note. When Keto Ventures did not meet Belleville's demands that the note be immediately repaid in full and that the shop and its inventory be turned over to her pursuant to the security agreement, Belleville and Mme. Pirie's commenced an action alleging causes of action for breach of contract and replevin against Keto Ventures, Keto and the administrator of Jessica Keto's estate. As part of that litigation, in July 2014, Supreme Court granted Mme. Pirie's and Belleville a temporary restraining order enjoining Keto Ventures, Keto and the administrator from "removing, transferring, dismantling, selling, pledging, or otherwise depleting or disposing of any of the [c]ollateral, or any products or proceeds thereof." Due to the July 2014 order, the shop was closed. In October 2014, the court issued an order continuing the temporary restraining order and permitting seizure of the collateral. Thereafter, in February 2016, the court granted a motion by Mme. Pirie's and Belleville for summary judgment on all causes of action. This Court later affirmed that order ( Mme. Pirie's, Inc. v. Keto Ventures, LLC, 151 A.D.3d 1363, 1366, 57 N.Y.S.3d 555 [2017] ).

Meanwhile, in July 2014, Keto formed plaintiff, a corporation to operate a new women's undergarment store; that store opened for business in November 2014 on the same road and less than a quarter of a mile from the shop. According to plaintiff, between October 15, 2014 and the opening of Keto's new store, defendants harassed Keto, interfered with her supply orders, suppliers and customers and made false statements concerning the existence of plaintiff's business. As a result, plaintiff commenced this action asserting causes of action sounding in defamation, tortious interference with business relations, and trespass to chattels and/or conversion. After issue was joined and the court-ordered date for completion of paper discovery expired, defendants moved for summary judgment dismissing the complaint. Supreme Court granted defendants' motion. Plaintiff appeals.

Supreme Court did not decide defendants' motion for summary judgment prematurely. Although a court may deny such a motion or hold it in abeyance to permit the parties to engage in discovery if the opponent of the motion establishes "that facts essential to justify opposition may exist but that such material facts are within the exclusive knowledge and possession of the moving party" ( Gersten–Hillman Agency, Inc. v. Heyman, 68 A.D.3d 1284, 1288, 892 N.Y.S.2d 209 [2009] [internal quotation marks, brackets and citations omitted]; see CPLR 3212[f] ; Citibank, NA v. Abrams, 144 A.D.3d 1212, 1213–1214, 40 N.Y.S.3d 653 [2016] ), "[s]ummary judgment may not be defeated on the ground that more discovery is needed, where, as here, the side advancing such an argument has failed to ascertain the facts due to its own inaction" ( Meath v. Mishrick, 68 N.Y.2d 992, 994, 510 N.Y.S.2d 560, 503 N.E.2d 115 [1986] ; see Seton Health at Schuyler Ridge Residential Health Care v. Dziuba, 127 A.D.3d 1297, 1300, 6 N.Y.S.3d 750 [2015] ; Ullmannglass v. Oneida, Ltd., 121 A.D.3d 1371, 1373, 995 N.Y.S.2d 776 [2014] ; Sloane v. Repsher, 263 A.D.2d 906, 907, 693 N.Y.S.2d 327 [1999] ). Here, in a scheduling order that prohibited the extension of any deadline without prior court approval, the court set a firm date for completion of paper discovery. Despite having 19 months between joinder of issue and the court's deadline, and six months after issuance of the court's scheduling order, plaintiff did not timely serve such discovery demands. Nor has plaintiff offered any explanation for failing to complete discovery within the ordered time frame or request an extension from the court (see Dalaba v. City of Schenectady, 61 A.D.3d 1151, 1153, 876 N.Y.S.2d 744 [2009] ; Steinborn v. Himmel, 9 A.D.3d 531, 535, 780 N.Y.S.2d 412 [2004] ). Further, plaintiff has failed to demonstrate that much of the requested discovery is in defendants' exclusive possession, as documents that defendants allegedly exchanged with suppliers and delivery companies would presumably be in the possession of those entities as well (see Gersten–Hillman Agency, Inc. v. Heyman, 68 A.D.3d at 1288, 892 N.Y.S.2d 209 ; Dalaba v. City of Schenectady, 61 A.D.3d at 1153, 876 N.Y.S.2d 744 ). Considering all of the circumstances, including the ample time originally provided for paper discovery, the court providently exercised its discretion pursuant to CPLR 3212(f) in declining to postpone decision on defendants' motion (see Meath v. Mishrick, 68 N.Y.2d at 994, 510 N.Y.S.2d 560, 503 N.E.2d 115 ; Seton Health at Schuyler Ridge Residential Health Care v. Dziuba, 127 A.D.3d at 1300, 6 N.Y.S.3d 750 ; Ullmannglass v. Oneida, Ltd., 121 A.D.3d at 1373, 995 N.Y.S.2d 776 ).

Supreme Court properly dismissed plaintiff's defamation cause of action. "The elements of a cause of action for defamation are a false statement, published without privilege or authorization to a third party, constituting fault as judged by, at a minimum, a negligence standard, and it must either cause special harm or constitute defamation per se" ( Loch Sheldrake Beach & Tennis Inc. v. Akulich, 141 A.D.3d 809, 815, 36 N.Y.S.3d 525 [2016] [internal quotation marks and citations omitted], lv dismissed 28 N.Y.3d 1104, 45 N.Y.S.3d 365, 68 N.E.3d 93 [2016] ; see Roche v. Claverack Coop. Ins. Co., 59 A.D.3d 914, 916, 874 N.Y.S.2d 592 [2009] ). Pursuant to the strict pleading requirements for defamation actions, "the particular words complained of shall be set forth in the complaint" ( CPLR 3016[a] ; see Demas v. Levitsky, 291 A.D.2d 653, 659, 738 N.Y.S.2d 402 [2002], lv dismissed 98 N.Y.2d 728, 749 N.Y.S.2d 477, 779 N.E.2d 188 [2002] ; Skelly v. Visiting Nurse Assn. of Capital Region, 210 A.D.2d 683, 686, 619 N.Y.S.2d 879 [1994] ), which must also contain "the time, place, and manner of the allegedly false statements and specify to whom such statements were made" ( Wegner v. Town of Cheektowaga, 159 A.D.3d 1348, 1349, 73 N.Y.S.3d 300 [2018] [internal quotation marks and citation omitted]; see Arvanitakis v. Lester, 145 A.D.3d 650, 651, 44 N.Y.S.3d 71 [2016] ; Dobies v. Brefka, 273 A.D.2d 776, 777, 710 N.Y.S.2d 438 [2000], lv dismissed 95 N.Y.2d 931, 721 N.Y.S.2d 606, 744 N.E.2d 142 [2000] ).

In the complaint, plaintiff alleges, in pertinent part, that, "upon information and belief, the [d]efendants told the potential customers not to do business with the [p]laintiff because the [p]laintiff was not a legitimate business and that the [d]efendants owned all of the [p]laintiff's supplies." Somewhat more specifically, plaintiff further alleges that, between "October 1, 2014 to December 1, 2014, the [d]efendants called, emailed and otherwise communicated with the [p]laintiff's suppliers, customers, mail carriers, and [credit card processing service] provider" and that those "communications with the suppliers and customers erroneously, maliciously and recklessly contained falsehoods concerning the [p]laintiff, to wit: ‘the [p]laintiff is not in business,’ ‘the [p]laintiff is an illegitimate business,’ and/or ‘the [p]laintiff business does not exist,’ or words to that effect."

These allegations lack the specificity required by CPLR 3016(a). Plaintiff improperly qualified the allegedly defamatory statements with the phrase "or words to that effect," indicating that the quotations are not, in fact, the exact or "particular words complained of" ( CPLR 3016[a] ; see Romanello v. Intesa Sanpaolo S.p.A., 97 A.D.3d 449, 455, 949 N.Y.S.2d 345 [2012], mod on other grounds 22 N.Y.3d 881, 976 N.Y.S.2d 426, 998 N.E.2d 1050 [2013] ; Gardner v. Alexander Rent–A–Car, Inc., 28 A.D.2d 667, 667, 280 N.Y.S.2d 595 [1967] ). "Merely paraphrasing the statements, notwithstanding the use of quotation marks to suggest a quotation where none...