Gibson v Williams Trading, LLC

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Gibson v Williams Trading, LLC 2006 NY Slip Op 30668(U) March 27, 2006 Supreme Court, New York County Docket Number: 602644/04 Judge: Herman Cahn Republished from New York State Unified Court System's E-Courts Service. Search E-Courts (http://www.nycourts.gov/ecourts) for any additional information on this case. This opinion is uncorrected and not selected for official publication. [* 1] SUPREME COURT OF THE STATE OF NEW YORK - NEW YORK COUNTY Index Number : 602644/2004 GIBSON, ELODIE FIELDING INDEX NO. vs MOTION DATE WILLIAMS TRADING, LLC Sequence Number : 007 MOTION SEQ. NO. DISMISS c- C' -1 MOTION CAL. NO. were read on this motion to/for The following papers, numbered 1 to PAPERS NUMBERED Notice of Morion/ Order to Show Cause Answering Affidavits - Affidavits - Exhibits Exhibits ... , _ Replying Af f ldavit6 Cross-Motion: - --- I.I. 1 ~ I No Yes Upon the foregoing papers, it is ordered that this motion Dated: ( $1 ._ 17 ' (-7 I2 L? ( [* 2] PI ai 11 tiffs, Index No. 602644/04 Molion S q . 007 WII,I,IAMS I KADING, LLC and DAV11) H. WILLIAMS, Plainliil s, -aga i 11st- hidex No. 602828/05 Motion Seq. 001 Motion seqiieiice 00 I i n thc action bearing Index No. 602828/2005 and motion scqucncc iiiimber 007 i 11tlic action bearing Tndex No. 602644/2004 are consolidaled i or decision. Plainli ffs iiiovc for summary judgmcnt and a dcclaralioii that they are Ihe prevailing party in both actions, and lhereforc arc cntitled to attorney s fccs in both actions. I;urthcr, PlaintXfs seek summary judgmenl lhat Ikfciidant David B. Williams individually brcaclicd his fiduciary duty pursuant to the Selllenicnt Agl-ccment. Plaintiffs also scck saiictions and lcgal fccs, pursuant to Administrative R ~ i k 130, as a rcsult of Ilekiidanls claimed lrivoloiis conduct. Addilionally, 13efcrdam move to discontinuc thc countcrclaiins, CPLR 321 7. Plaiiitifls [* 3] opposc ttic ciisc(mtinuaiicc~ i r i t i lthc legal fcc Background Pluintill Elodie Fielding Gibson was employed as Chief Financial Ol licer of Ilelenclaiit Williams I radiiig, I ,I L:, ( Williams l radiiig )a securities brokeriigc t iim. After leaving hcr employmenl, shc liwiied which she served ;I consulting company, Plaintiff 1,013 Consul tiiig Services, Tnc, or ;IS presidenl. LOT) and Williams Trading entcrcd inlo ;I consulling arraiigcniciit. DelendanI h v i d Williams is the managing member 01 Williams Trading. P 1a.iiit i 1 18 iii a.dc cl ;I iiii s reg a r di iig Will i iims ireatinen t o I G ibson d ui-i17g h c r tcii u re w i I h Williams l rxiiiig. I hoscclairiis were settled in a Scttlcmcnt Agrccment dated May 16, 2002. This action arises o u l of alleged breaches of thc Sel.tlenienl. Agreement. 111 lhe agrccmcnt, del-kndants agreed that Willjariis Trading would make qiiarkrly payments to Gibson, commencing oii July 3 I , 2002, through January 3 I , 2007. Further, Paragraph 24 of the Agrcciiicnt piwidcs that in the evcnl o l a dispute between the parties resulling in litigation or arhi tration, tlic rcasonablc attorney s fccs and costs of thc prevailing party shall be paid by the losing party. Paragraph 1 1 of the Agreement states that David W i l lianis shall cause tlie company [Williaiiis I radiiig] to comply with the terms o l [the agreeme1it]. . . Wi1li:iiiis Trading madc ihc payments unti I .luly 3 1 , 2004, wlicii it r-cfuscd 10 iiinke the payment due on that date, stating that it was iiivestigalirig wrongful conduct by Gibson. Action # I , the 2004 nction: M e r demanding paymcnt, Gi hson commenced this action (Action //l),in order to collect tlie July 3 1, 2004 payment, together with attorney lees. On October 29, 2004, Williaiiis Trading made the payment due on July 3 1, 2004, but relused to pay 2 [* 4] the lcgal 1Lc.s associated with thc litigation. I hercfore, Gihii coiilinucd the litigation. On Fehr~iaryIS, 2005, Williiiiiis Trading 1~lcildt.d two counterc13iiiis. I helirst sought a cleclaratory judgment for the propcr calculation of [lie paymcnts, pursuant to thc Scttlement hgrecmciil. 1 hc second allegecl l~reacli coiilract, of asscr-ling that Gibson disclosed ccrtain coiitidential inli)rniation in br-cach of the selllciiienl agrcciiien t. On May 1 1, ?O057 this cuurl dccided h a t Gibson was 1hc prevuiling parly bccause Williiims I rading conccded lhat it owed the paymenl sucd li)r, and that, tlicrehrc, Williams Trading wab required lo pay reasonablc attorney fccs. This court r c k 1 - d tlic amount 01 altorncy lies to II Spccid licfcree to hear and report. This court also denied Williaiiis I rading niotions for a protective order arid lo disyuidify Gibson s couriscl, and scvered Williarns I rading s ounterclaims. Subsequcntly, [his court again rcjccted Williams l rading arguiiicnts on rcargu nieiil. Action # 2, the 2005 action: Williams I ri1dingalso did not tinicly makc tlic payments duc Jaiiuaiy 30, 2005,April 30, 2005, and July 31, 2005. Thercfore, Gibson coiiiriiciicd tlic sccond action to collect those payments, as well as altorncy I ecs. On Scptembcr 14, 2005 Wil I iaiiis Trading made llic demandcd payiiiciils but again rcflwed to pay attorneys fccs, The motions were thc1*eupoIitl1ildc. Dis cu ssio II Declaration lhat l laintiffs are thc prevailiw party in Action 1 and Action 2 and thc rcsultinrr attorney fccs: Acticm I Gibson argues that it is tlic prevailing party in thc rcinainder of Action 1, Williams 3 [* 5] 8 cowiterclai iiis, I~cc;iiise W i I 1 ianis I radiiig sccks 1.0 discontinuc its counterclaiiiis. Tlwelbre, Gibsnii argi.ics llial, purswinl to thc ScttlemenL Agrcclnenl, Gibsoii is entitled to ai1 orclcr that Williams I rading must pay all attorney fccs r e l a ~ to tlic counterclaims. l Williams Trading counkrs thal Gibson is not thc prevailing pat-ly with regard to tlie count.erclainis. It argues h a t this cowl grantcd leave 1.0 assert thc two c,ounlerclaiim. l luxcl ore, in conncction wilt1 attorncy preparalion towards Ihc Icrwc to amend, William Trading argues that it. is tlio prcvailing party and that it, thercforc, is cntilled to attorncy Lees. Next, in regards to ils iiiotioii to discontinuc its couiiterclainis, Williams I radingargiies that Gibson is not the prevailing p;irly hccaiisc a. volunlary disnii.ssa1o f a claim is n Lvolimtaiy act and the advcrsary cannot be thc prcvailing party thcreon. 11- notcd that this argument is very similar to is Williams Trading s c d i e r argumeiit that w s re.jcctcd by this ~011t-t s a May 1 1, 2005 decision. I hcrc,the court r-cjec~.ed i I liaiiis Trading s arguiiient that Gi bson was not the prcvailing party W because it voluntarily conceded ancl made the dcniandcd payments. Action 2 Gibson argues that shc i s the prevailing party in Actiou 2 for the samc reasoiis thal this court lield she was tlie prevailing party in Action 1.: by making the payments . . . dcfciidants have grrtntccl plainlifftlic r e l i d s h e soiiglil. , . Just as in Action 1 in Action 2 Williams Trading ~ cvcntu.nlly did r:iiake the paynients. Gibson argues that, thcrefore, as the prcvniling party she is entitlcd to reasoliable a.ttorncys fees. Willi.ains I raditigeKcctivcly iiiakcs thc same argumcnts as i.n Action No. 1 . It argues that i t voluiitarily al tcicd its condiict by making the payinents. Williaiiis Trading also argues that Gibson is prccl uded from claiiiiiiig prcvai ling party status, becausc she iiiaterially breachcd tlic 4 [* 6] S u 1I I ctiicri L Ag rcc iiicii 1 t>y cl i sc 1os i ng,W i 11i ; i m Tracl i rig s cunGd er dial G iiai 1ci nl stalcn icr ils. I 1 Williams Trading argiies t h d duc to Gibson s alleged breach it liad thc rig111 to withhold thc qunrtcr-ly pnyiiiciits, I licrcfor-c, Williams I radingargucs, while i t lakr made thc payments, Gihson caniiot be dcomccl thc prevailing party. It is clcar that in both aclions Williams Trading conccdcd that (iihsnn was enlitled io thc pay I iI c I i t s t I i :it i t w i t h 11 c I cl , ni id i rid ccd mad c tho sc pay men t s . I? I ir t her. i t v o 1i i i i t 3r i 1y d i sc o n t in i.rcd countorclaims it had inlerposcd. Common sense dictates t h a t Gibson, having won hcr claims is thc prevailing party. I iirsuant lo the agreement, she i s thcrcfim cntitlcd to rccovcr hcr counsel lees. Plainlill s molioiis are gr-aiitcd. Lkfeiidaiils iiiotioii to discontiiiuc tlic countcrclaini is also gran~ed. h c appl icalion f or I sanctions is also dcnicd. Settle order. Ilatcd: March 27, 2006 ENTER: This claimed breach is the saiiie claim that Williams l radingis now moving to discontinue. 5

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