The Supreme Court's determinations, inter alia, that the plaintiff failed to meet its burden of establishing that the defendant Emily S. Brooks breached a fiduciary duty, and that she was entitled to severance compensation pursuant to the terms of the parties' partnership agreement, were warranted by the facts ( see ProHealth Care Assoc., LLP v. Shapiro, 46 A.D.3d 792, 793, 849 N.Y.S.2d 276; Greenberg v. Joffee, 34 A.D.3d 426, 427, 824 N.Y.S.2d 355;ProHealth Care Assoc., LLP. v. April, 4 Misc.3d 1017[A], 2004 N.Y. Slip Op. 50919[U], 2004 WL 1872915 [Sup. Ct., Nassau County];see also Northern Westchester Professional Park Assoc
The evidence submitted by the plaintiff indicated that he was compensated as a shareholder and member, participated as a shareholder and member in decisions regarding hiring, firing, and purchasing equipment, and was represented as a shareholder and member in OSM and OSM Realty tax returns ( see Moser v Devine Real Estate, Inc. [Florida], 42 AD3d 731, 733-734; Roth v Speilman, 25 AD3d 383). Accordingly, the defendants' motion for summary judgment dismissing the complaint was properly denied. The plaintiff met his prima facie burden of establishing his entitlement to judgment as a matter of law dismissing the defendants' counterclaim by demonstrating that he did not misappropriate any trade secrets or engage in any fraudulent activity in setting up a competing medical practice ( see Walter Karl, Inc. v Wood, 137 AD2d 22, 27; ProHealth Care Assoc., LLP v April, 4 Misc 3d 1017 [A], 2004 NY Slip Op 50919[U]). In opposition, the defendants failed to raise a triable issue of fact. Furthermore, the plaintiff met his prima facie burden of establishing that the doctrine of unclean hands, raised in the defendants' third affirmative defense, was inapplicable because the plaintiff did not act inequitably in establishing his competing medical practice ( see Tepfer v Berger, 119 AD2d 668, 669).
Another line of authorities concerns entities that are not authorized to have patients or practice medicine (see ProHealth Care Assoc., LLP. v April, 4 Misc.3d 1017[A], 2004 NY Slip Op 50919[U], *4 [Sup Ct, Nassau County 2004] ["A partnership does not practice medicine and does not have patients. The physicians, who are partners in a medical practice... practice medicine and have patients."]).
No cause of action for conversion exists based on the alleged conversion of intangible property, such as confidential information contained in patient lists ( see Rao v Verde, 222 AD2d 569, 570; MBF Clearing Corp. v Shine, 212 AD2d 478, 479; Woodie v Azteca Intl. Corp., 9 Misc 3d 1104 [A], 2005 NY Slip Op 51401 [U],*5 [2005]). Here, the conversion of confidential patient information does not involve items of tangible personal property or specific money ( see Rao, 222 AD2d at 570; Prohealth Care Assoc., LLP v April, 4 Misc 3d 1017 [A], 2004 NY Slip Op 50919 [U], *7), nor have plaintiff's alleged that defendants exercised dominion or control over the alleged "assets" to the exclusion of plaintiffs' rights ( MBF Cleaning Corp. v Shine, 212 AD2d 479). Thus, dismissal of plaintiffs' third cause of action for conversion is mandated ( see CPLR 3211 [a] [7]).
"The fact that the allegations underlying the breach of fiduciary duty claim may overlap with the breach of contract claim does not require the dismissal of the breach of fiduciary duty claim." Prohealth Care Associates, LLP v. April, 2004 WL 1872915, at *5 (N.Y. Sup. Aug. 18, 2004) (citations omitted). Instead, the Court must determine whether the facts alleged sufficiently state the elements of a breach of fiduciary duty.
In Centro Empresarial, the Court held that the relevant fiduciary duties arose from the contract at issue, but that they existed independently of that agreement and thus were not subject to dismissal on duplicity grounds. 901 N.Y.S.2d at 636. See also Prohealth Care Associates, LLP v. April, No. 15830β03, 4 Misc.3d 1017(A), 2004 WL 1872915, at *5 (N.Y.Sup. Aug. 18, 2004) (βThe same conduct may constitute both a breach of contract and a breach of a fiduciary duty.β) (citing Bender Ins. Agency, Inc. v. Treiber Ins. Agency, Inc., 283 A.D.2d 448, 729 N.Y.S.2d 142 (2nd Dept.2001); Davis v. Dime Savings Bank of New York, 158 A.D.2d 50, 557 N.Y.S.2d 775 (3rd Dept.1990)). Similar exceptions exist under California and New Jersey law for independent fiduciary duty claims.
A plaintiff alleging trade-secret misappropriation "'must demonstrate [as relevant here]: (1) that it possessed a trade secret, and (2) that the defendants used that trade secret... as a result of discovery by improper means'" (Schroederv Pinterest Inc., 133 A.D.3d 12, 27 [1st Dept 2015] [citation omitted]). As is relevant here, although a patient list may constitute a trade secret (see Prohealth Care Assocs., LLP v Apr., 4 Misc.3d 1017[A], 2004 NY Slip Op 50919[U], * 3 [Sup Ct, Nassau County 2004]), the question of whether a list allegedly belonging to a plaintiff constitutes a trade secret is ordinarily an issue of fact that should be left for trial (Ashland Mgt. Inc. v Altair Invs. NA, LLC, 59 A.D.3d 97, 102 [1st Dept 2008], affd as modified, 14 N.Y.3d 774 [2010]).
Although this claim is technically labeled as one sounding in breach of fiduciary duty, the complaint repeatedly asserts that, by failing to timely install proper lighting, the Harbor Ridge Defendants breached provisions of the offering plan, by-laws and declaration of covenants and restrictions (Cmplt. ΒΆΒΆ 33[a], 34). Parties may plead alternative and contradictory theories of liability" ( Prohealth Care Assoc., LLP v. April, 4 Misc 3d 1017(A), 2004 WL 1872915 at * 5-6 [Sup. Ct. Nassau Co. 2006]. See also, Gold v. 29-15 Queens Plaza Realty, LLC, 43 AD3d 866, 867 [2nd Dept. 2007]; West Park Assoc., Inc. v. Cohen, 43 AD3d 818, 819 [2nd Dept. 2007]; and CPLR 3014), and that "[t]he same conduct may constitute both a breach of contract and a breach of a fiduciary duty." Hamlet on Olde Oyster Bay Home Owners Assn., Inc. v. Holiday Organization, Inc., 12 Misc 3d 1182(A) (Sup.Ct. Nassau Co. 2006).
Nevertheless, without attempting to separate them, defendants collected all of the business and patient records and failed to return them to the plaintiffs until several months had passed. Therefore, issues of fact exist as to which party had the superior right to possess the records since neither party sought to separate the medical records belonging to the Hospital's patients or the records belonging exclusively to GHC's patients before they were removed from plaintiffs' office ( see, Prohealth Care Assocs., LLP v April, 4 Misc 3d 1071 A, 798 NYS2d 347 [2004]; Roth v Barreto, supra;O'Neill vFishkill, supra; see alsoEmergency Vision, Inc. v Main Place Opts., 10 Misc 3d 1071 A, 814 NYS2d 560). Accordingly, defendants' motion for summary judgment dismissing plaintiffs' first cause of action for conversion of its business and patient records is denied.