Watkins v J C Land Dev. Ltd.

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Watkins v J C Land Dev. Ltd. 2009 NY Slip Op 33278(U) October 28, 2009 Supreme Court, Suffolk County Docket Number: 30678-2007 Judge: Emily Pines 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] Y IKDEX NUMBER: 30678-2007 - SUPREME COURT STATE OF NEWY O R K COMMERCIAL DIVISION, PART46,SUFFOLK COUNTY Original Motion Date: Motion Submit Date: Motion Sequence No s.: f r o e n f :HOI\I.EMILY PINES J. S. C. x WILLIAM WATKINS a/Wa CHIP WATKINS, individually and as a shareholder on behalf of .I C LAND DEVELOPMENT, I .TD., Plaintiff, -against,I C LAND DEVELOPMENT LTD, JOHN C ENCI arid CHRISTOPHER BRADSHAW, Defendants. 08-26-2009 09-03-2005) 007 MI) Attorney for Plaintiffs Thaler & Gertler, LLP By: Kim v. Victor, Esq. 90 Merrick Avenue, Suite 400 East Meadow, New York 11554 Attorney for Defendants J C Land and Cenci Matthew J. Barnes, Esq. Barnes & Barnes, PC 146 1 Franklin Avenue Garden City, New York 11530 Attorney for Defendant Brads & Farrell Fritz, PC Bruce N. Roberts, Esq. 1320 RexCorp Plaza Uniondale, New York 1 1556 ORDERED, that the motion (motion sequence number 007) by plaintiff pursuant to CPLR : 1 ( e )is denied in its entirety. 722 111 this shareholder s derivative action, this is a motion by plaintiff seeking leave to renew its c.pposition to ( 1 ) the motion for summary judgment by defendants J.C. Land Development C o y . ( J.C. I md , and John Cenci ( Cenci ); (2) the motion to dismiss by defendant Christopher Bradshaw i 13radshaw ) and (3) the motion to cancel the notice of pendency filed by plaintiff. By Order (PINES, I ciatcci June 19,2009 this Court granted the motion by J.C. Land and Cenci to for summary judgment ,111ci dismissed the action; in light thereof, the Court denied the motion to dismiss by Bradshaw as moot ,:nil cancelcd the notice of. pendency. a 1 he gr,ivamen of the motion to dismiss was that plaintiff, Watkins, should be judicially estopped I tom claiinrng an ownership interest in J.C. Land based on certain contradictions between the allegations I Iiat t o m the hasis for the complaint in this case and statements Watkins made in a certain Presentence [* 2] 11 atkins \ C eiici 1 IId c x number 3 0678 -2 7 00 2 lo1 ion sequence number 007 Decision i\.erort (* I SK ) which were purportedly relied upon by a federal judge when sentencing Watkins. ~pecilically, March 5 , 1999, Watkins pled guilty before Judge Jed S. Rakoff of the Southern District on 1 U c u York. of conspiracy to violate narcotic laws under 21 U.S.C. §841(b)(l)(B). Although the -.cnrencing guidelines mandated imposition of a monetary fine, Judge Rakoff waived the fine, finding t r i .-(no)tine will be imposed because the Court made a finding that, in his present circumstances and ~ 1 tiie foreseeable future, (Watkins) will not be able to pay any material fine . In the instant case lwwever. Wat kins claims that he and Cenci formed JC Land on March 25, I999 and that he provided ~60~3,000 (including cash of $130,000) toward its formation. Rased on these disparities and contradictions, Cenci sought disclosure of the PSR, yet plaintiff i esisted disclosure requiring Cenci to move before Judge Rakoff for an Order releasing the PSR. By ( kder dated June 9,2009, Judge Rakoff granted the motion to produce those portions of the PSR relating i Watkins financial condition, along with all probation records containing statements made by rcspondent concerning his financial condition. Judge Rakoff found that Cenci demonstrated a compelling need for disclosure ofthe PSR to meet the ends ofjustice , stating that (i)n the New York x t i o n and dissolution proceeding, however, (Watkins) alleges that on or about March 25, 1999, i.e., *nwity days after (Watkins) pleaded guilty before this Court, he and (Cenci) formed a real estate Jev elopment company, and that, beginning less than a month after being incarcerated, respondent iii\,scsted appi oximately $600,000 in that corporation . Further, Judge Rakoff found that (a)fter !)leading guilly, (Watkins) provided certain information to the probation department concerning his linances for use in his PSR. At (Watkins ) sentencing hearing, the Court adopted the factual findings :he PSR.. . and, as noted, declined to impose any fine based on its determination concerning 1 CbLitkins ) indbility to pay . 1 It Hascd upon the foregoing, this Court, in its June 19, 2009 Order found that defendants had iicmonstrated entitlement to summary judgment on the ground ofjudicial estoppel. The Court held that ..ince Watkins obtained a judgment in his favor (to wit, the waiver of a monetary fine) based upon wxrtions of penury and lack of assets before the Federal Court, this Court would not permit him to r t i p t e his claims to real property or accountings based on funds he now states he began transferring at thc precise titne of his contradictory statements to probation, relied on by a federal judge. Therefore tic C oiirt granted summary judgment and dismissed the action. i Page 2 of 4 [* 3] \1 ~ i t I , i i i \ \ C cnci i i i dL \ 17 11 i n bel 3 06 7 8 - 2 007 \lotion sequence number 007 Decision f lantiff now seeks leave to renew its opposition to the motion for summary judgment, the i ~ o t i o n disiniss by Bradshaw and the motion to vacate the notice of pendency. Plaintiff states that he to obtained a full copy of the PSR and concluded that it contains inaccuracies regarding plaintiffs . i ~ l to ~pay a fine. Instead, plaintiff claims that the PSR stated that the Probation Department found i ~ ; ! - a t he i i a s able to pay a fine but that they did not recommend a fine based on familial obligations . I iaintift argues that the Court relied on the erroneous assertion that he was unable to pay a fine, and that 1 I thc Court had the full PSR, it would not have concluded that judicial estoppel barred the within action. 1 h i i > . plaintiff urges the Court to grant renewal, and upon renewal, deny the motion for summary judgment, the motion to dismiss and the motion to vacate the notice of pendency. > <iim i i s Ilefentiants Cenci and Bradshaw separately oppose the motion to renew. Cenci argues that this t t)iirt relied upon Judge Rakoff s Order and the findings contained within such Order in granting the 1?io1ion t or summary judgment dismissing the action based upon judicial estoppel. Watkins benefitted fmni the factual findings in the PSR that he could not pay a fine and he received leniency. Cenci asserts thai Watkins withheld the nature of his assets when he was sentenced and Judge Rakoff relied on such rc:presentations when he waived the fine. Moreover, Cenci notes that plaintiff has strenuously objected to the production of the PSR during the course of the litigation, even refusing to permit an i camera n iiispection of the document. Cenci argues that plaintiff has made the same arguments before Judge liakoff which were rejected in his June 9, 2009 Order, Likewise, Bradshaw argues that Watkins has i<iiledt o salisfy the requirements of a motion for leave to renew and states that if the PSR had relevant Tiiii)rmation, Watkins should have obtained it earlier and permitted its disclosure. Plaintiff submits reply papers and Cenci submits a sur-reply, both reiterating their arguments on 7 11sm o t i o n . I ssenlially, plaintiff is claiming that errors existed in the PSR, and Judge Rakoff and this Court < ! i d o n t h o x errors. Such argument is without merit in that this Court relied on Judge Rakoff s June 2009. portions of which it quoted in its June 19, 2009 Order and again in this Decision and Order. i. <isplaintiffclaims, certain provisions of the PSR were inaccurate, his remedy lies solely before Judge iiaLoft: and not this Court. It is the Court s understanding that plaintiff has moved before Judge Rakoff i t ~ ;inC)rdcr pursuant to Federal Rules of Civil Procedure Rule 60(a) to correct certain alleged mistakes r \ \ f I,KI contained in the PSR. Such motion is sub judice. Thus, it would be inappropriate for this Court s a 1 Page 3 of 4 [* 4] 1 C enii in&\ number ;0678-2007 \ l o t i o n sequence number 007 Decision $ i ;itJ,itis , y r m t leave to renew based upon alleged errors in the PSR as such is clearly within the purview of the 1 \ i t t. .1 C ourt. The motion for leave to renew is therefore denied in its entirety. I> 1 i This constitutes the DECISION and ORDER of the Court. Dated: October 28, 2009 Ri\crheaci, New York J. S. C. Page 4 of 4

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