Salvatore v Kumar

[*1] Salvatore v Kumar 2006 NY Slip Op 50946(U) [12 Misc 3d 1157(A)] Decided on April 18, 2006 Supreme Court, Suffolk County Emerson, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on April 18, 2006
Supreme Court, Suffolk County

Irene Salvatore, ANDREW PRESS and BRIAN WRIGHT, Plaintiffs,

against

Sanjay Kumar, COMPUTER ASSOCIATES INTERNATIONAL, INC., KAYE SCHOLER, LLP, JANE W. PARVER, ESQ., STAVIS & KORNFELD, ESQS. and ROGER L. STAVIS, ESQ., individually, jointly and severally, Defendants.



8565-05



LAW OFFICES OF THOMAS F. LIOTTI

Attorney for Plaintiffs

600 Old Country Road, Suite 530

Garden City, New York 11530

MELITO & ADOLFSEN, P.C.

Attorneys for Defendants Stavis & Kornfeld, Esqs., and Roger L. Stavis, Esq.

233 Broadway, 28th Floor

New York, New York 10279

FARRELL FRITZ, P.C.

Attorneys for Defendant Computer Associates International, Inc.

EAB Plaza, West Tower, 13th Floor

Uniondale, New York 11556 KAYE SCHOLER, LLP

Attorneys Pro Se and for Defendant Jane W. Parver, Esq.

425 Park Avenue

New York, New York 10022

DAVIS POLK & WARDWELL

Attorneys for Defendant Sanjay Kumar

450 Lexington Avenue

New York, New York 10017

Elizabeth Hazlitt Emerson, J.

ORDERED that the motion by defendant Sanjay Kumar to dismiss the complaint for failure to state a cause of action under CPLR 3211(a)(7) is granted; and it is further

ORDERED that the motion by defendant Computer Associates International, Inc to dismiss the complaint for failure to state a cause of action under CPLR 3211(a)(7) is granted; and it is further

ORDERED that the motion by defendants Kay Scholer, LLP, and Jane W. Parver, Esq., to dismiss the complaint for failure to state a cause of action under CPLR 3211(a)(7) is denied; and it is further

ORDERED that the motion by defendants Stavis & Kornfeld, Esqs., and Roger L. Stavis, Esq., to dismiss the complaint for improper service of process is referred to a traverse hearing, which shall be held on June 27, 2006 at 10:00 a.m., Supreme Court, Courtroom 7, Arthur M. Cromarty Criminal Court Building, 210 Center Drive, Riverhead, New York 11901.

This is an action to recover damages for defamation, wrongful termination,

promissory estoppel, conspiracy, and legal malpractice. Plaintiffs are former employees of defendant Computer Associates International, Inc. (hereinafter CA). Their employment with CA was terminated on or about April 2004. The complaint alleges that the terminations occurred following plaintiffs' participation in meetings with attorneys from the law firm of Sullivan & Cromwell, LLP, during which they were questioned about an internal investigation initiated by the Board of Directors of CA regarding internal accounting practices.

Plaintiffs allege that the following statements, which were included in CA's 2004 Annual Report, were untrue and defamatory towards them: [*2] "The analysis included a review of arrangements where customer signatures were obtained late as well as where the customer signature was timely but our countersignature was obtained late. The analysis also included a review of other revenue recognition requirements so as to ensure the accuracy and completeness of the restatement.""... including a practice of holding the financial period open after the end of the fiscal quarters, providing customers with contracts with preprinted signature dates, late countersignatures by Company personnel, backdating of contracts, and not having sufficient controls to ensure the proper accounting under SOP 97-2. In addition, the Audit Committee found that certain former executives and other personnel were engaged in the practice of Acleaning up@ [sic] contracts by, among other things, removing fax time stamps before providing agreements to the outside auditors. These same executives and personnel also misled our outside counsel, and accounting advisers regarding these accounting practices. We believe that we now have the adequate systems and controls in place to assure proper treatment of revenue recognition under our current Business Model and are considering additional improvements." (Complaint, ¶ 49).

Plaintiffs also allege that they were wrongfully terminated without just cause or