Opinion
No. 650182/2020 MOTION SEQ. NO. 003
10-17-2022
ARTISANAL CHEESE, LLC, Plaintiff, v. CHARLES APT, JILL GIACOMINI BASCH, BECKY RENRO BORBOLLA, JULIA BUSHA, SUSAN ERIKSEN, DAVID GREMMELS, BETH HALEY, LORI KING, NONA LIM, MATT KROENCKE, EMILIO MIGNUCCI, JON PRUDEN, LEE ZALBEN, PHIL KAFARAKIS, SPECIALTY FOOD ASSOCIATION, INC. Defendants.
Unpublished Opinion
DECISION + ORDER ON MOTION
JOEL M. COHEN, J.S.C.
The following e-filed documents, listed by NYSCEF document number (Motion 003) 77, 78, 79, 80, 81, 82, 83, 84, 85, 86, 87, 88, 90, 91, 92, 93, 101, 102, 103, 104, 105, 106, 107, 108, 109, 110, 111, 112, 113, 114, 115, 116, 117, 118, 119, 120, 121, 122, 123, 157 were read on this motion to DISMISS THIRD-PARTY COUNTERCLAIM
Upon the foregoing papers, Defendants' motion to dismiss the third-party counterclaim of Third-Party Counterclaim-Defendant Daniel W. Dowe ("Dowe") is DENIED without prejudice because Dowe was never properly added as a party to this case (CPLR 3019). Thus, Defendants' counterclaims against Dowe are not properly before the Court in the first instance (CPLR 3011). The Court's Decision and Order is without prejudice to the parties or to Mr. Dowe seeking to properly re-assert their claims.
BACKGROUND
On January 8, 2020, Plaintiff Artisanal Cheese, LLC ("Plaintiff), filed a Complaint (NYSCEF 2) against Defendants Charles Apt, Jill Giacomini Basch, Becky Renfo Borbolla, Julie Busha, Susan Eriksen, David Gremmels, Beth Haley, Lori King, Nona Lim, Matt Kroencke, Emilio Mignucci, Jon Pruden, Lee Zalben, Phil Kafarakis, and Nominal Defendant Specialty Food Association, Inc. ("SFA") (collectively "Defendants"). Generally, Plaintiff contests its removal as a member of SFA.
On March 9, 2020, Defendants filed an Answer with Counterclaims (NYSCEF 56) purporting to assert counterclaims by SFA against Plaintiff, which was proper, and non-party Dowe, an attorney and Executive Chairman of Plaintiff. No summons naming Mr. Dowe was filed nor is there any indication that Dowe was separately served. On May 15, 2020, Plaintiff and Dowe submitted a Reply to Counterclaims and a purported Third-Party Counterclaim by Dowe against Defendants (NYSCEF 66). No Third-Party Index Numbers have been assigned by the Clerk of Court.
On July 16, 2020 Defendants moved (NYSCEF 77) to dismiss Dowe's purported third-party counterclaim pursuant to CPLR 3211(a)(7). After the motion was filed, on July 28, 2020 the Court (Friedman, J.) "So Ordered" the parties' briefing schedule providing for opposition papers to be filed on August 27, 2020. for reply papers to be filed on September 25, 2020 and for the return date to be adjourned until September 28, 2020.
On August 26, 2020 - one day before opposition was due - a substitution of counsel was filed by Plaintiff Artisanal Cheese, LLC and Dowe (NYSCEF 94). To complicate matters, the incoming firm was Dowe Partners LLC, of which Mr. Dowe is a partner.
The next day, August 27, 2020, Dowe Partners LLC filed a letter indicating that they sought a thirty-day extension from counsel for Defendants to respond to the motion to dismiss (NYSCEF 99). On September 14, 2020, Dowe Partners LLC, wrote another letter indicating that they had made efforts to secure an extension (NYSCEF 100).
On September 28, 2020 - the return date - Plaintiff and Dowe filed opposition to the motion to dismiss (NYSCEF 101-116). On October 1, 2020, Defendants filed a Notice of Rejection (NYSCEF 117) claiming that the opposition was untimely. On October 7, 2020, Plaintiff and Dowe filed an opposition to the Notice of Rejection annexing correspondence indicating their efforts to secure an extension from both Defendants' counsel and the Court (NYSCEF 118-123).
On January 29, 2021, Defendants moved (NYSCEF 126) for a preliminary injunction to preclude Plaintiff, Dowe and their counsel from communicating with any Defendant. On February 22, 2021, following Justice Friedman's retirement, this case was assigned to this Court (NYSCEF 148). On February 22, 2021, the Court herd oral argument on the preliminary injunction motion (NYSCEF 154) and subsequently granted the motion in a March 11, 2021 Order (NYSCEF 156). During oral argument, Dowe repeatedly discussed the fact that he wanted to settle the case.
On March 23, 2021, counsel for Plaintiff and Dowe filed a letter (NYSCEF 157) arguing that Defendants should be precluded from filing a reply vis-a-vis their motion to dismiss his counter-counterclaim. Defendants did not respond. As no reply was filed, this motion was never marked "submitted" for disposition. There has been no activity on the docket for more than a year-and-a-half
DISCUSSION
In order for a counterclaim to be asserted against a non-party, a third-party action must be commenced, and a summons served (N.Y.Prac, Com. Litig. in New York State Courts § 8:154 [5th ed.] [collecting cases]). CPLR 3011 provides, in relevant, part:
A defendant's pleading against another claimant is an interpleader complaint, or against any other person not already a party is a third-party complaint. There shall be a reply to a counterclaim denominated as such, an answer to an interpleader complaint or third-party complaint, and an answer to a cross-claim that contains a demand for an answer. If no demand is made, the cross-claim shall be deemed denied or avoided. There shall be no other pleading unless the court orders otherwise.
Accordingly, if Defendants wanted to add Dowe as a party, they were required to serve a summons on him pursuant to CPLR 3019 (Baychester Shopping Ctr., Inc. v Llorente, 175 Misc.2d 739, 741 [Sup Ct New York County 1997] ["The proper way to assert the counterclaims against the individual Defendants on the counterclaims would be to serve them with a summons and the Answer"]). It logically follows that, absent party status, Dowe lacked the ability to file the purported third-party counterclaim in the first instance (Linzer v Bal, 184 Misc.2d 132, 135 [Civ Ct New York County 2000] quoting CPLR 3019[d] ["when the counterclaim alleges that 'a person not a party is ... liable a summons and answer containing the counterclaim ... shall be filed, whereupon he or she shall become a defendant'"]). However, the Court may grant leave to re-plead defective counterclaims (Platinum Recovery Services, Inc. v Jones, 2002 NY Slip Op 40070(U) [App Term 2d Dept. Jan. 23, 2002] [".. .in actuality {defendant} seeks leave to serve an amended answer containing a counterclaim against a nonparty, plaintiffs attorneys, pursuant to CPLR 3019, similar to the counterclaim interposed against the plaintiff. Accordingly, the cross motion is granted to the extent of granting {defendant} leave to interpose her counterclaim against the nonparty in accordance with CPLR 3019[d]").
* * * *
Accordingly, it is
ORDERED that Defendants' motion to dismiss Dowe's third-party counterclaim is DENIED without prejudice should Do we be properly added as a party and assert a procedurally proper claim; it is further
ORDERED that the parties to this case file a stipulation withdrawing this case if it has been settled or, in the alternative, a joint status letter on NYSCEF on or by October 24, 2022; it is further
ORDERED that the Court's Decision and Order is without prejudice to any party or Mr. Dowe properly asserting their claims under the CPLR.
This constitutes the decision and order of the Court.