Nas Electronics v. Transtech Electronics Pte

• Decision Date: 05 May 2003
• Docket Number: No. 01 CIV. 2810(JGK).,01 CIV. 2810(JGK).
• Citation: 262 F.Supp.2d 134
• Parties: NAS ELECTRONICS, INC., Jerry Choe and Pil Yon Choe Plaintiffs v. TRANSTECH ELECTRONICS PTE LTD., and NAS-Transtech Technology Ltd., Defendants.
• Court: U.S. District Court — Southern District of New York

262 F.Supp.2d 134

NAS ELECTRONICS, INC., Jerry Choe and Pil Yon Choe Plaintiffs v. TRANSTECH ELECTRONICS PTE LTD., and NAS-Transtech Technology Ltd., Defendants.

No. 01 CIV. 2810(JGK).

United States District Court, S.D. New York.

May 5, 2003.

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Paul W. Siegert, Jung & Siegert, New York City, for Plaintiffs.

Gary D. Sesser, Carter, Ledyard & Milburn, New York City, for Defendants.

OPINION AND ORDER

KOELTL, District Judge.

This action was originally brought in New York State Supreme Court, New York County by NAS Electronics, Inc. ("NAS Electronics"), Jerry Choe, and Pil Yon Choe, (collectively "the plaintiffs") and raised five causes of action, including fraud, breach of contract, tortious interference, slander and a cause of action for a preliminary injunction against Transtech Electronics Pte Ltd. ("Transtech"), NAS-Transtech Technology Ltd. ("NAS-Transtech"), and four individual defendants, Isao Kakimoto, Pauline Chen, Tan Kim Heng and C.C. Tang. Through this lawsuit, the plaintiffs sought to prevent the defendants from enforcing a judgment, entered pursuant to a settlement agreement in a case previously before this Court involving the same parties, against certain real property owned by the plaintiff Jerry Choe in Ulster County, New York. After the New York State Supreme Court declined to prevent the sale of the real property at issue, all the defendants removed the action to this Court. The claims against the individual defendants were dismissed, and discovery was completed. Transtech and NAS-Transtech (collectively "the defendants") have now moved for summary judgment on the plaintiffs' claims of fraud and breach of contract, and have moved to dismiss the remaining claims for tortious interference, slander, and for a preliminary injunction. The plaintiffs have cross moved for various relief and seek the following: partial summary judgment on the breach of contract claim, an additional opportunity to amend the complaint, and additional time to conduct further discovery.

I.

The standard for granting summary judgment is well established. Summary judgment may not be granted unless "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed. R.Civ.P. 56(c); see also Celotex Corp. v. Catrett, All U.S. 317, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Gallo v. Prudential Residential Servs. Ltd. Partnership, 22 F.3d 1219, 1223 (2d Cir.1994). "The trial court's task at the summary judgment motion stage of the litigation is carefully limited to discerning whether there are genuine issues of material fact to be tried, not to deciding them. Its duty, in short, is confined at this point to issue-finding; it does not extend to issue-resolution." Gallo, 22 F.3d at 1224. The moving party bears the initial burden of "informing the district court of the basis for its motion" and identifying the matter that "it believes demonstrate!^] the absence of a genuine issue of material fact." Celotex, All U.S. at 323, 106 S.Ct. 2548. The substantive law governing the case will identify those facts that are material and "only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Anderson v. Liberty Lobby, Inc., All U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

In determining whether summary judgment is appropriate, a court must resolve all ambiguities and draw all reasonable inferences against the moving party. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986) (citing United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 8 L.Ed.2d 176 (1962)); see also Gallo, 22 F.3d at 1223. Summary judgment is improper if there is any evidence in the record from any source from which a reasonable inference could be drawn in favor of the nonmoving party. See Chambers v. TRM Copy Ctrs. Corp., 43 F.3d 29, 37 (2d Cir.1994). If the moving party meets its burden, the burden shifts to the nonmoving party to come forward with "specific facts showing that there is a genuine issue for trial." Fed. R.Civ.P. 56(e). The nonmoving party must produce evidence in the record and "may not rely simply on conclusory statements or on contentions that the affidavits supporting the motion are not credible." Ying Jing Gan v. City of New York, 996 F.2d 522, 532 (2d Cir.1993); see also Scotto v. Almenas, 143 F.3d 105, 114-15 (2d Cir. 1998) (collecting cases).

The defendants filed a statement of undisputed facts as required by Local Civil Rule 56.1(a) but the plaintiffs filed no statement admitting or denying any of the facts the defendants set forth as being undisputed, as required by Local Civil Rule 56.1(b). The plaintiffs also failed to file a statement of undisputed facts in support of their motion for partial summary judgment. The plaintiffs' failure to respond or contest the facts set forth by the defendants in their Rule 56.1 statement as being undisputed constitutes an admission of those facts, and those facts are accepted as being undisputed. See Local Civil Rule 56.1(c); Gubitosi v. Kapica, 154 F.3d 30, 31 n. 1 (2d Cir.1998); United States v. All Right, Title and Interest in Real Property and Appurtenances, 11 F.3d 648, 657-58 (2d Cir.1996); John Street Leasehold, LLC v. Capital Mgmt. Res., L.P., 154 F.Supp.2d 527, 534 (S.D.N.Y.2001), aff'd, 283 F.3d 73 (2d Cir.2002).

Therefore, the facts contained in the defendants' Rule 56.1 statement, and the relevant history of the earlier case previously before this Court, which are the basis for the dispute in the present action, are as follows.

In February 1998, Transtech and NAS-Transtech commenced an action in this Court, Transtech Electronics Pte Ltd. et al, v. NAS Electronics, 98 Civ. 1209, against NAS Electronics, Jerry Choe and Alentino, Ltd., seeking to recover damages in excess of $3.2 million for goods sold and delivered to NAS Electronics and seeking to compel NAS Electronics to transfer to NAS-Transtech certain patent rights to a wireless karaoke microphone, known as the Leadsinger. (Settlement Agreement attached as exh. B. to Aff. of Gary D. Sesser ("Sesser Aff) sworn to Nov. 7, 2002 ¶ 4.) In October 1988, Transtech and NAS-Transtech amended their complaint, adding additional defendants and additional claims. (Settlement Agreement ¶ 15.) With the knowledge that the assets of NAS Electronics had been sold to Eok Cho Industrial Metal Co. Ltd of Korea ("Eok Cho"), Transtech and NAS-Transtech commenced a fraudulent conveyance action in New York State Supreme Court, New York County to set aside the transfer of assets from NAS Electronics to Eok Cho. (See Settlement Agreement ¶ 6.)

On August 24, 1999, the parties entered into a Settlement Agreement resolving the federal and state actions and an additional action in Singapore. (Settlement Agreement ¶ 1.). The Settlement Agreement provided that Jerry Choe would pay NAS-Transtech $800,000 over a period of five years. (Settlement Agreement ¶ III; Defts.' Rule 56.1 Stmt. ¶ 4.) The payment schedule for this payment required that a payment of $50,000 be made by October 27, 1999, and that periodic payments, increasing over time, would be made until April 27, 2004. (Payment Schedule attached as Exh. 2 to Settlement Agreement; Defts.' Rule 56.1 Stmt. ¶ 4.) The Settlement Agreement also provided that within 90 days of the settlement, Jerry Choe, NAS Electronics and Pil Yon Choe would assign to NAS-Transtech ten patents relating to Leadsinger. (Settlement Agreement ¶ 1; List of Patents attached as exh. 1 to Settlement Agreement; Defts.' Rule 56.1 Stmt. ¶ 5.) Transtech and NAS-Transtech were required to dismiss with prejudice the New York State litigation relating to the alleged fraudulent conveyance and the Singapore litigation. The federal action was to be dismissed without prejudice and subject to reopening. (Settlement Agreement ¶ IX.) Additionally, Transtech, NAS-Transtech, Pauline Chen, Isao Kakimoto, Tan Kim Heng a/k/a Alan Tan, and C.C. Tang were given the "exclusive right to market and sell Leadsinger products" in various countries, including the Asian portion of Russia. (Settlement Agreement ¶ V.)

The Settlement Agreement further provided that should any payment due not be made in a timely manner, with the default uncorrected for a period of seven days, or should the enumerated Leadsinger patents not be assigned or transferred within 90 days of the date of the Settlement Agreement, judgment could be entered by this Court against Jerry Choe, Pil Yong Choe, and NAS Electronics and in favor of NATranstech and Transtech in the amount of $3,200,000. (Settlement Agreement ¶ IV.) The Settlement Agreement is governed by and is to be construed in accordance with the substantive laws of the State of New York. (Settlement Agreement ¶ X.)

By Opinion and Order dated April 12, 2000, this Court found that the two events entitling Transtech and NAS-Transtech to Judgement in the amount of $3,200,000 had occurred, because there had been a failure by Jerry Choe, NAS Electronics or Pil Yong Choe to transfer the Leadsinger patent rights or make timely payment. See Transtech Electronics Pte Ltd. v. NAS Electronics, Inc., No. 98 Civ. 1209, 2000 WL 381428, at *2 (S.D.N.Y. Apr. 13, 2000); (See also Defts.' Rule 56.1 Stmt, ¶ 6.) Jerry Choe, Pil Yong Choe, and NAS Electronics made various arguments seeking to prevent the entry of judgment, including a contention that the Settlement Agreement should not be enforced because NAS-Transtech and Transtech had failed to meet their obligations, by interfering with the rights of Jerry Choe, Pil Yong Choe and NAS Electronics to sell the Leadsinger in Western Russia. The Court found that this argument was...