Summary
holding defendant made a prima facie showing of good faith by establishing that revenue was withheld in order to make improvements or repairs on the businesses' properties
Summary of this case from Puka Capital Funding LLC v. L&N Twins Place LLC. (In re L&N Twins Place LLC.)Opinion
2014-01-15
Elaine ZUCKERBROD, appellant, et al., plaintiffs, v. 355 COMPANY, LLC, et al., respondents.
Martin Zuckerbrod, Cedarhurst, N.Y. (Joseph Capobianco of counsel), for appellant. Newman Ferrara LLP, New York, N.Y. (Jarred I. Kassenoff and Glenn Berezanskiy of counsel), for respondents.
Martin Zuckerbrod, Cedarhurst, N.Y. (Joseph Capobianco of counsel), for appellant. Newman Ferrara LLP, New York, N.Y. (Jarred I. Kassenoff and Glenn Berezanskiy of counsel), for respondents.
PETER B. SKELOS, J.P., MARK C. DILLON, THOMAS A. DICKERSON, and LEONARD B. AUSTIN, JJ.
In an action, inter alia, to recover damages for breach of fiduciary duty and fraud, the plaintiff Elaine Zuckerbrod appeals, as limited by her brief, from so much of an order of the Supreme Court, Nassau County (Driscoll, J.), entered December 13, 2011, as granted that branch of the defendants' motion which was for summary judgment dismissing the complaint insofar as asserted by her.
ORDERED that the order is affirmed insofar as appealed from, with costs.
The Supreme Court properly granted that branch of the defendants' motion which was for summary judgment dismissing the complaint insofar as asserted by the plaintiff Elaine Zuckerbrod (hereinafter the appellant) based on, among other things, the business judgment rule. The business judgment rule “bars ‘judicial inquiry into actions of corporate directors taken in good faith and in the exercise of honest judgment in the lawful and legitimate furtherance of corporate purposes' ” (North Fork Preserve, Inc. v. Kaplan, 68 A.D.3d 732, 733, 890 N.Y.S.2d 93, quoting Auerbach v. Bennett, 47 N.Y.2d 619, 629, 419 N.Y.S.2d 920, 393 N.E.2d 994). The defendants established, prima facie, that the defendant Morton Olshan acted in good faith and in the lawful and legitimate furtherance of the purposes of the defendants 355 Company, LLC, 60 West 76 Co., LLC, and 68 Montague Co., LLC (hereinafter collectively the LLCs), when he retained revenue derived from the buildings owned by the LLCs to pay for repairs and capital improvements to those buildings, and when he entered into a management agreement on behalf of the LLCs with the defendant Janoff & Olshan, Inc. ( see north fork preserve, inc. v. kaplan, 68 A.D.3d aT 733, 890 N.Y.S.2d 93). In opposition to the defendants' prima facie showing in this regard, the appellant failed to adduce evidence to substantiate her allegations of fraud, bad faith, or breach of fiduciary duty and, thus, failed to raise a triable issue of fact ( see id.). The appellant's mere hope and speculation that evidence sufficient to defeat the defendants' motion for summary judgment might be uncovered through further discovery was insufficient to defeat the motion ( see Buchinger v. Jazz Leasing Corp., 95 A.D.3d 1053, 1054, 944 N.Y.S.2d 316; Zarzycki v. Lan Metal Prods. Corp., 62 A.D.3d 788, 790, 879 N.Y.S.2d 174).
Moreover, insofar as the appellant's causes of action alleged that wrongs were committed against the LLCs, she should have asserted causes of action derivatively, rather than in her individual capacity ( see generally Tzolis v. Wolff, 10 N.Y.3d 100, 109, 855 N.Y.S.2d 6, 884 N.E.2d 1005; see also Mizrahi v. Cohen, 104 A.D.3d 917, 919, 961 N.Y.S.2d 538).
Accordingly, the Supreme Court properly granted the defendants' motion for summary judgment dismissing the complaint insofar as asserted by the appellant.