Scheiner v. Wallace
| Decision Date | 13 September 1993 |
| Docket Number | No. 93 Civ. 0062 (RWS).,93 Civ. 0062 (RWS). |
| Citation | 832 F. Supp. 687 |
| Parties | Randy SCHEINER, Royce Scheiner, Cindy Royce Creations, Inc. and Maximus Creations Limited, Plaintiffs, v. Derek WALLACE, Brian Daniels, Paul Hunt, and David Williams, sued on their own behalf and on behalf of all other Lloyd's Underwriters subscribing to Policy Numbers ZJB8901346 251NM and ZJB900233 255M, White, Fleischner, Fino & Wade, Dennis Wade, Holmes Protection of New York, Inc., Hartley Cooper Associates, Ltd., Levmore-Finch, Inc., Graham Miller, Inc., Shaun Coyne, Karl Alizade, City Safe, Inc. and J.M. McNicholas, Defendants. |
| Court | U.S. District Court — Southern District of New York |
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Morvillo, Abramowitz, Grand, Iason & Silberberg, P.C., New York City, for defendants Derek Wallace, Brian Daniels, Paul Hunt, David Williams, Lloyd's Underwriters, White, Fleischner, Fino & Wade, Graham Miller, Inc., Shaun Coyne, Karl Alizade, City Safe, Inc. and John M. McNicholas (Michael C. Silberberg, of counsel).
Nourse & Bowler, New York City, for defendant Hartley Cooper Associates, Ltd.
Lapidus & Frankel, P.A., Miami, FL (Robert P. Frankel, of counsel) and Hein Hazelberg, New York City, for plaintiffs.
Defendants Derek Wallace, Brian Daniels, Paul Hunt, David Williams, Lloyd's Underwriters Subscribing to Policy Numbers ZJB8901346 251NM and ZJB900233 255M, ("Lloyd's"), White, Fleischner, Fino & Wade ("WFFW"), Holmes Protection of New York, Inc. ("Holmes"), Graham Miller, Inc. ("Miller"), Shaun Coyne, Karl Alizade, City Safe, Inc. ("City Safe") and Detective John M. McNicholas ("McNicholas"), (collectively the "Defendants") have moved for an order dismissing Plaintiffs Randy Scheiner's, Royce Scheiner's, Cindy Royce Creations, Inc.'s ("Cindy Royce"), and Maximus Creations Limited's ("Maximus"), (collectively the "Plaintiffs") Complaint, pursuant to Rule 12(b), Fed.R.Civ.P., or granting summary judgment against Plaintiffs' claims, pursuant to Rule 56, Fed.R.Civ.P.
Defendant Hartley Cooper Associates, Limited ("Hartley Cooper") separately moved for an order granting summary judgment pursuant to Rule 56 Fed.R.Civ.P. or dismissing all claims for lack of pendant jurisdiction.
For the reasons set forth below, the Defendants' motions are granted in part and denied in part.
Plaintiff Cindy Royce is a New York corporation. Its principal office is in New York City and its primary business is manufacturing and selling jewelry.
Plaintiff Maximus is a New York corporation. Its principal office is in New York City and its primary business is manufacturing and selling jewelry.
Samuel Scheiner was and is Secretary/Treasurer and fifty-percent shareholder of Cindy Royce and Secretary/Treasurer and one-third owner of Maximus. Samuel Scheiner supervised the overall operations and finances of both Cindy Royce and Maximus.
Morton Gold was President and fifty-percent owner of Cindy Royce and Vice-President and one-third owner of Maximus. Gold supervised the jewelry manufacturing on the premises at 501 Madison Avenue.
Daniel Squillante was President and one-third owner of Maximus. Squillante supervised the overall operations of the Maximus line of jewelry.
Randy Scheiner is a New York citizen and resident residing in Cedarhurst, New York. He was a salesman for Maximus. He is the son of Samuel Scheiner and plaintiff Royce Scheiner.
Royce Scheiner is the wife of Samuel Scheiner.
Derek Wallace, Brian Daniels, Paul Hunt and David Williams are citizens of the United Kingdom, with their principal place of business in London. As Lloyd's underwriters, they subscribed to the insurance policies in this case.
WFFW, a law firm, is a general partnership organized and existing under the laws of the State of New York. Attorneys in WFFW are licensed to practice law in the State of New York. Dennis Wade is a partner in WFFW. Dennis Wade worked first as an Assistant District Attorney and second as Deputy Chief of the Rackets Bureau in the New York County District Attorney's Office.
Holmes is a corporation organized and existing under the laws of New York. Cindy Royce and Maximus contracted Holmes to provide security services.
Hartley Cooper, an insurance brokerage, is an English Corporation with its principal place of business in England. Hartley Cooper acted as a "placing broker" by placing primary and excess insurance policies for Cindy Royce and Maximus on the London market.
Levmore-Finch, an insurance brokerage, is a New York corporation with its principal place of business in New York City.
Graham Miller is an adjustment firm retained by Lloyd's. Shaun Coyne is a loss adjuster at Miller.
City Safe, a New Jersey corporation, has its principal place of business in New Jersey and New York. The firm provides safe expertise for Lloyd's. Karl Alizade is a principal of City Safe.
Detective McNicholas, formerly with the New York City Police Department, helped investigate the reported burglary of Cindy Royce and Maximus.
On January 7, 1990, Cindy Royce and Maximus initiated a civil suit in the English High Court of Justice, Queen's Bench Division, Commercial Court (the "English Action") against 106 Lloyd's underwriters. Mr. Justice Waller presided. In their "Points of Claim" (Complaint), Cindy Royce and Maximus alleged that Lloyd's' rejection of the Plaintiffs' Proof of Loss statement was a breach of contract on Jewelers Block Insurance Policies ZJB8901346 251NM and ZJB900233 255M. Plaintiffs sought $2,475,000.00 and $2,500,000.00 per policy and interest.
On October 2, 1991, in the thirtieth day of the trial, Cindy Royce and Maximus applied to discontinue the English Action, provided they would not pursue their claims elsewhere with court ordered costs. Their application for discontinuance was denied. On October 3, 1991, the Plaintiffs' abandoned their claims and Mr. Justice Waller entered a dismissal for the Defendants.
Plaintiffs appealed Mr. Justice Waller's denial of discontinuance to the English Court of Appeal. Lord Donaldson upheld the denial of discontinuance and affirmed the dismissal in favor of the Defendants.
On March 25, 1992, Samuel Scheiner, Morton Gold, Daniel Squillante, Benoit Dreyfus, Randy Scheiner, Cindy Royce, and Maximus were indicted by the Grand Jury of the County of New York on three counts: (1) Conspiracy in the Fourth Degree, in violation of Penal Law Section 105.10(1); (2) Insurance Fraud in the First Degree, in violation of Penal Law Section 176.30; and (3) Attempted Grand Larceny in the First Degree, in violation of Penal Law Sections 110.00 and 155.42.
In a plea agreement entered into on October 16, 1992, all charges against Randy Scheiner, Cindy Royce and Maximus were dismissed. At the same time, Samuel Scheiner, Morton Gold and Daniel Squillante pled guilty to Attempted Grand Larceny in the Fourth Degree. As a result of a separate indictment, Daniel Squillante pled guilty to violating Tax Law Section 1804(b), failing to properly report his taxable income for the years 1986 through 1990.
Also in 1992, Cindy Royce and Maximus filed suit in the Southern District of New York against their English counsel, Simmons & Simmons. On July 27, 1993, Judge Patterson granted Simmons & Simmons' motion for summary judgment against Cindy Royce and Maximus' claims of professional malpractice, breach of contract, and violation of New York judiciary law section 487 and denied summary judgment on their claims of unjust enrichment. Judge Patterson also granted Simmons & Simmons' motion to dismiss pursuant to the doctrine of forum non conveniens.
On January 6, 1993, Plaintiffs Randy Scheiner, Royce Scheiner, Cindy Royce and Maximus filed this action against Defendants. In their complaint, the Plaintiffs allege the following:
On March 9, 1993,1 the collective Defendants filed a motion for summary judgment, on the grounds of res judicata and/or collateral estoppel, as to all asserted claims or, in the alternative, a motion to dismiss all asserted claims for failure to state a claim and failure to plead two of the claims sounding in fraud, and requesting an order requiring Plaintiffs to post a security bond for $250,000.
On May 14, 1993, Defendants Hartley Cooper filed a separate motion for summary judgment as to all claims asserted against it on the grounds of collateral estoppel, or in the alternative, an order dismissing all claims against Hartley Cooper for lack of pendant jurisdiction.
Defendant Levmore-Finch did not answer or file motions to dismiss in this action.
Oral argument on the motions was heard on June 30, 1993 and the...
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