Melcher v. Greenberg Traurig, LLP
| Decision Date | 09 November 2011 |
| Docket Number | Index No. 650188/07 |
| Citation | 2011 NY Slip Op 34074 |
| Court | New York Supreme Court |
| Parties | JAMES L. MELCHER, Plaintiff, v. GREENBERG TRAURIG, LLP & LESLIE D. CORWIN, Defendants. |
In this action, plaintiff, James Melcher, seeks treble damages for defendants' alleged violation of section 487(1) of the Judiciary Law in the separate action of Melcher v Apollo Med. Fund Mgt. L.L.C. and Brandon Fradd (Sup Ct, NY County, Index No. 604047/2003) (Apollo Action). Defendants now move to dismiss the instant action as time-barred.
Melcher and Brandon Fradd were members and managers of Apollo Management L.L.C. (Apollo), a company allegedly formed to be the general partner of the hedge fund Apollo Medical Partners, L.P. A dispute arose between Melcher and Fradd over Melcher's contractual right to Apollo's profits under Apollo's Operating Agreement. On December 17, 2003, Melcher allegedly informed Fradd that he was prepared to sue to enforce his contractual rights. Melcher claims that the next day, he saw for the first time a "purported 'May 21, 1998 amendment'" to the Operating Agreement (Amendment), which "Fradd asserted drastically cut [Melcher's] share of the profits of the company." First Amended Complaint, Reardon Aff., Ex. D, ¶¶ 19, 58. Melcher commenced the Apollo Action on December 29, 2003, seeking to recover his membership share of profits under Apollo's Operating Agreement. Fradd and Apollo relied uponthe purported Amendment to refute Melcher's claims in the Apollo Action. Defendants, Greenberg Traurig, LLP (GT) and Leslie Corwin (Corwin), a GT partner, represented Apollo and Fradd in the Apollo Action.
In the instant action, Melcher claims that the Amendment was a back-dated forgery prepared by Fradd. Melcher claims that GT and Corwin engaged in deceit and consented to Fradd's deceit, using the allegedly manufactured evidence in the Apollo Action. Specifically, the pleading alleges that, on January 27, 2004, Melcher, Corwin and Fradd met to discuss the Apollo Action. At that meeting, Corwin allegedly stated that he had "personally confirmed the authenticity of the [Amendment] with the lawyer for [Apollo] who had drafted it." First Amended Complaint, ¶ 22 [emphasis in original]. At this meeting, Melcher claims that his attorney requested production of the original Amendment for forensic testing, to determine when it was created. Id., ¶ 30. Also on January 27th, Fradd was served with the summons and complaint in the Apollo Action. According to Melcher, the next day, Fradd claims to have "'accidentally' burned the original of the 'amendment' on the stove in his apartment, supposedly 'while making tea,'" rendering it untestable. Id., ¶¶ 33, 57.
In February 2004, GT and Corwin moved to dismiss the Apollo Action, based upon a purported copy of the Amendment, which had pre-dated the burning, as documentary evidence. Id., ¶ 43. According to Melcher, GT and Corwin's motion to dismiss failed to disclose that the Amendment had been burned, even though, at the time of the motion, Melcher's motion to obtain the original Amendment for forensic chemical testing was before the court. Melcher claims that, on February 23, 2004, Corwin "misleadingly represented to the Supreme Court that the original of the 'amendment' was safely in his custody 'in escrow' and would remain so during thependency of the motion to obtain the original," even though GT and Corwin knew that Fradd had recently burned the document. Id., ¶¶ 46-48. The court dismissed two of the seven causes of action in the Apollo Action (fraud and conversion) and otherwise denied the motion to dismiss. Melcher v Apollo Med. Fund Mgt. L.L.C., 2004 NY Slip Op 30147(U), 2004 WL 5400353 (Sup Ct, NY County, Sept. 10, 2004, Cahn, J., index No. 604047/2003), affd 25 AD3d 482 (1st Dept 2006).
According to Melcher, defendants then engaged in a "deceptive cover-up," with the intent to deceive the Supreme Court and Melcher by preventing them from learning that Fradd had burned the original Amendment in order to frustrate forensic testing and to obtain the dismissal of the Apollo Action based upon the forged, back-dated Amendment. Id., ¶¶ 57-59. The alleged cover-up was based upon two facts known by defendants to be false: that Lowenthal Landau Fischer & Bring, PC, the law firm which supposedly prepared the Amendment, had gone out of business1; and that James Beckwith, a retired Vermont lawyer who supposedly prepared and handled documents regarding Apollo, refused to return any of defendants' phone calls or provide evidence regarding the Amendment. Id., ¶¶ 60-62 (citing Fradd's March 12, 2004 affidavit).
Melcher alleges that on March 15, 2004, the court in the Apollo Action ordered that the Amendment be disclosed to Melcher. On March 18, 2004, Corwin sent Melcher the "original" Amendment, which consisted of "the scorched remnant of the original that remained after [Fradd's] burning thereof." Id., ¶ 81. Melcher claims that this was the first time he learned of the burning and that he transmitted the document to a forensic chemist. In a report dated April13, 2004, Melcher's forensic chemist concluded that the burning of the document rendered '"any analytical technique that measures the changes to ball pen ink by exposure to environmental conditions over time, useless.'" Id., ¶ 84; Reardon Aff, Ex. G. In the same report, the forensic chemist determined that the burning "was not 'accidental.'" First Amended Complaint, ¶ 86.
On April 14, 2004, the court granted Melcher's application to inspect Fradd's apartment, where the burning took place, and to expedite Fradd's deposition. At his deposition on April 21, 2004, Fradd allegedly testified that he did not recall all of the material facts regarding the burning. In a May 19, 2004 affidavit, allegedly drafted by defendants, Fradd claimed that the Amendment was authentic and renewed his false claims that the attorney who drafted the document was unavailable and that the law firm had gone out of business. In this affidavit, Fradd stated, "I have tried to contact Mr. Beckwith, and my attorneys have tried to contact Mr. Beckwith, but to no avail." Id., ¶ 90. Melcher claims that defendants knew from a February 2004 telephone interview with Beckwith that he did not draft the Amendment. In fact, Melcher claims that a February 7, 2006 e-mail confirms Beckwith called GT the same day that he received a Federal Express letter from Corwin. Id., ¶¶ 72-73. Beckwith also allegedly testified that he had delegated Apollo's drafting work to another Apollo lawyer, Jack Governale.
Depositions in the Apollo Action commenced in the fall of 2005. Melcher claims that the deposition cf Governale in December of 2005 revealed that Governale had represented Apollo continuously from 1998. and that the law firm files regarding Apollo had not been disrupted, but had been in Governale's continuous custody. In his December 2005 affidavit and January 2006 affirmation submitted to the First Department, Corwin allegedly represented that Beckwith was "unavailable to talk and has resisted all prior attempts to do so" (id., ¶¶ 100, 106), even though,as discussed above, Corwin had communicated with Beckwith as early as February 2004. Id., ¶¶ 66-77.
After Governale's deposition, Melcher obtained the billing records of Apollo's law firm for the period February 1 to December 31, 1998, the time when the Amendment was allegedly prepared. According to Melcher, in a decision and order dated August 15, 2006 in the Apollo Action, Judge Beverly Cohen determined that Id., ¶ 104.
After several delays, Beckwith was deposed on June 11, 2007. According to the First Amended Complaint, Beckwith testified that: Fradd called Beckwith "within the last few years," indicating that Corwin "was going to reach out and talk to [Beckwith] about some documents"; Beckwith indicated to Fradd that he "would take the call from Mr. Corw in" and did take a call from Corwin concerning the Apollo Action; Beckwith indicated his "willingfness] to speak with them"; and Beckwith was never asked to prepare an affidavit. Id., ¶¶ 70-71. Melcher claims that Beckwith's testimony belies Corwin's sworn statements that Beckwith was unavailable and had resisted prior attempts at contact. Id., ¶¶ 116, 67-77.
Melcher commenced the instant action, two weeks later, on June 25, 2007.2
Defendants argue that Melcher's complaint is time-barred by the three-year statute of limitations applicable to section 487 of the Judiciary Law. Melcher counters that the statute of limitations is six years. In the alternative, Melcher argues that his cause of action did not accrue until the conclusion of the Apollo Action or during the continuing violations perpetrated by defendants. Additionally, he argues that defendants should be equitably estopped from asserting the statute of limitations defense.
On a motion to dismiss a complaint pursuant to CPLR 3211(a)(5) on statute of limitations grounds, the moving defendant must establish, prima facie, that the time in which to commence the action has expired. Benn v Benn, 82 AD3d 548, 548 (1st Dept 2011). Once defendant has met his burden, the burden shifts to the plaintiff to raise an issue of fact as to whether the statute of limitations is tolled or is otherwise inapplicable. Williams v New York City Health and Hosps. Corp., 84 AD3d 1358, 1359 (2d Dept 2011). Benn, 82 AD3d at 548 [internal quotation marks and citations omitted].
The statute of limitations under section...
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