Quadriad Realty Partners, LLC v. Wilbee Corp.
| Decision Date | 06 January 2020 |
| Docket Number | INDEX NO. 153621/2018 |
| Citation | 2020 NY Slip Op 30024 (U) |
| Parties | QUADRIAD REALTY PARTNERS, LLC,45 WEST 36TH STREET, NEW YORK, NY 10018, DEVELOPMENT PLANNING & DESIGN INC.,45 WEST 36TH STREET, NEW YORK, NY 10018, Plaintiffs, v. WILBEE CORPORATION, 31-31 48TH AVENUE, LONG ISLAND CITY, NY 11101, KING KULLEN GROCERY CO., INC.,185 CENTRAL AVENUE, BETHPAGE, NY 11714, QUEENSBORO FARM PRODUCTS, INC.,156-02 LIBERTY AVENUE, JAMAICA, NY 11433, KAUFMAN BEDROCK ASTORIA I LLC,34-12 36TH STREET, ASTORIA, NY 11106, SILVERSTEIN PROPERTIES, INC.,7 WORLD TRADE CENTER, 250 GREENWICH STREET, 38TH FLOOR, NEW YORK, NY 10007, BEDROCK REAL ESTATE PARTNERS, LLC. 215 PARK AVENUE SOUTH, SUITE 2016, NEW YORK, NY 10003, Defendants. |
| Court | New York Supreme Court |
The following e-filed documents, listed by NYSCEF document number (Motion 011) 423, 424, 425, 426, 427, 428, 433, 434, 435, 436, 437 were read on this motion for LEAVE TO AMEND INTERVENORS' COMPLAINT.
This case revolves around a real estate development project in Astoria, Queens - the Steinway Square Project (the "Project") - and the years-long odyssey to bring that Project to life. Thus far, however, the litigation of this case has been preoccupied with determining the right parties to prosecute the action. Now, having obtained a default judgment against erstwhile Plaintiffs Quadriad Realty Partners, LLC and Development Planning and Design, Inc. (the "Plaintiffs"), Plaintiffs-Intervenors Robert Gans ("Gans") and W&G Venture Holdings LLC ("W&G") (collectively, "Intervenors") seek leave to amend their Complaint to add, refine, and reintroduce certain claims. For the reasons set forth below, Intervenors' motion is granted in part and denied in part.
RELEVANT BACKGROUND
Originally, Plaintiffs filed a Complaint alleging that they invested significant time and money shepherding the Project through an arduous regulatory process until Defendants1 ousted them, usurping the benefits of Plaintiffs' hard work for themselves. See Original Compl., ¶¶1-4 (NYSCEF Doc. No. 1). The Plaintiffs' Complaint alleged three causes of action: (1) tortious interference with prospective business relations against Silverstein and Bedrock; (2) unjust enrichment against all Defendants; and (3) breach of an implied contract against all Defendants. See id.
Intervenors were granted leave to intervene in the case on June 21, 2018. See July 11, 2018 Decision and Order (NYSCEF Doc. No. 124). They alleged, essentially, that they had bought out Plaintiffs' interests in the Project and were therefore the rightful owners of all claims asserted by Plaintiffs against Defendants in this action. See Intervenors' Am. Compl., ¶74 (NYSCEF Doc. No. 135). Accordingly, the Intervenors' Complaint asserted a cross-claim against Plaintiffs seeking a declaratory judgment to that effect. Id.
In addition, the Intervenors asserted eight causes of action against Defendants: (1) intentional interference with contract against Silverstein and Bedrock; (2) intentional interference with prospective economic advantage against Silverstein and Bedrock; (3) unjust enrichment against Silverstein and Bedrock; (4) unfair competition against Silverstein and Bedrock; (5) ideamisappropriation against Silverstein and Bedrock; (6) promissory estoppel against Queensboro, King Kullen, and Wilbee; (7) declaratory judgment against all Defendants; and (8) preliminary and permanent injunction against all Defendants. Id., ¶¶75-115.
Defendants moved to dismiss both the Plaintiffs' and Intervenors' Complaints, and on December 20, 2018, this Court (Bransten, J.) granted Defendants' motions in part. See NYSCEF Doc. No. 246 (the "Dec. 20 Decision and Order"). As relevant here, the Court dismissed Intervenors' claims for unfair competition, idea misappropriation, and for a preliminary and permanent injunction. See id. The Court also dismissed Plaintiffs' cause of action for breach of an implied contract, ruling that the allegations were "too vague and indefinite." Id., at 16.2
The parties then proceeded to discovery, with a plan to first resolve the cross-claim between Plaintiffs and Intervenors, in order to determine who was the real party in interest against Defendants. That plan ran aground, however, when Plaintiffs stopped prosecuting their case. On April 25, 2019, the Court granted Plaintiffs' counsel's motion to withdraw from his representation of Plaintiffs, which stayed all proceedings for 30 days so that Plaintiffs could appear with new counsel by May 30. See NYSCEF Doc. No. 337. New counsel did not appear by that deadline, however, and have not appeared since. In July 2019, Intervenors and Defendants both moved for default judgments against Plaintiffs.
In a Decision and Order dated September 3, 2019, this Court granted those motions for default judgment against Plaintiffs. In granting Intervenors' motion, the Court entered a judgment in favor of Intervenors declaring that Intervenors are "the rightful owner[s] of 100% of the assets of W&G," and that Intervenors "are the owners of all claims asserted by Plaintiffs andany recovery to Plaintiffs in this action must be turned over to [Intervenors]." NYSCEF Doc. No. 415. The Court then set a deadline for Intervenors to file a motion for leave to amend the Intervention Complaint, allowing Intervenors to add Plaintiffs' defaulted claims to their own. Id.3 And that is, in part, what Intervenors seek to do with this motion. But Intervenors also seek to revive their own previously dismissed claims, on the basis of purported new evidence.
LEGAL ANALYSIS
Under CPLR 3025, a party may amend its pleadings "at any time by leave of court," and such "[l]eave shall be freely given," including "permit[ting] pleadings to be amended before or after judgment to conform them to the evidence." CPLR 3025(b)-(c). Deciding a motion for leave to amend requires a brush with the merits of the case, if only to discern whether the proffered amendments are "palpably insufficient or clearly devoid of merit." Cruz v. Brown, 129 A.D.3d 455, 456 (1st Dep't 2015). Indeed, the First Department "has consistently held that in order to conserve judicial resources, examination of the underlying merit of the proposed amendment is mandated," so that "[l]eave will be denied where the proposed pleading fails to state a cause of action, or is palpably insufficient as a matter of law." Thompson v. Cooper, 24 A.D.3d 203, 205 (1st Dep't 2005), citing Davis & Davis, P.C. v. Morson, 286 A.D.2d 584, 585 (1st Dep't 2001); see also Walter & Rosen, Inc. v. Pollack, 101 A.D.2d 734 (1st Dep't 1984) ().
Moreover, leave to amend is properly denied when proposed new claims are "merely restatements" of previously dismissed claims. Kassover v. PVP-GCC Holdingco II, LLC, 73 A.D.3d 626, 629 (1st Dep't 2010) (); Sutton Apartment Corp. v. Bradhurst 100 Dev. LLC, 160 A.D.3d 508, 509 (1st Dep't 2018) (); cf. Eshaghian v. Eshaghian, 170 A.D.3d 416, 416 (1st Dep't March 5, 2019) ().
Defendants do not oppose Intervenors' motion to the extent it seeks to (1) add claims which were not previously asserted in the Original Intervention Complaint, namely, Intervenors' expanded claim for unjust enrichment against defendants King Kullen, Wilbee, Queensboro, and KBA, and a breach of contract claim against Silverstein; (2) reassert a declaratory judgment claim against King Kullen, Wilbee, and Queensboro; and (3) withdraw Intervenors' promissory estoppel claim (the "Unopposed Amendments"). See Defs.' Opp. to Intervenors' Mot. for Leave to Amend, at 7 (NYSCEF Doc. No. 436).
The proposed additions are not palpably insufficient or clearly devoid of merit. Accordingly, Intervenors' unopposed motion as to these amendments is Granted.
Next, Intervenors seek to reinstitute a claim for unfair competition against Silverstein and Bedrock, alleging that they "co-opted, misappropriated and usurped for themselves" the work of Gans, Quadriad, and Wollman (which are owned by Intervenors), "as well as the benefits flowing from Gans' time, effort and monetary investment." PAC, ¶142.
Macy's Inc. v. Martha Stewart Living Omnimedia, Inc., 127 A.D.3d 48, 56 (1st Dep't 2015) (internal citations omitted). Such a claim requires "either a confidential relation between the parties or a valid agreement to refrain from the alleged unfair competition." V. Ponte & Sons v. Am. Fibers Intl., 222 A.D.2d 271, 271 (1st Dep't 1995) (); Miller v. Walters, 46 Misc. 3d 417, 427 (Sup. Ct. N.Y. Cty. 2014) (...
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