TMR Bayhead Sec., LLC v Aegis Tex. Venture Fund II, LP

TMR Bayhead Sec., LLC v Aegis Tex. Venture Fund II, LP 2014 NY Slip Op 02731 Decided on April 22, 2014 Appellate Division, First Department Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and subject to revision before publication in the Official Reports.

Decided on April 22, 2014
Tom, J.P., Renwick, Richter, Feinman, Gische, JJ.
12306N 115387/08

[*1]TMR Bayhead Securities, LLC, et al., Plaintiffs-Respondents,

v

Aegis Texas Venture Fund II, LP, et al., Defendants-Appellants.




Ganfer & Shore, LLP, New York (Ira B. Matetsky of counsel),
for appellants.
Dewey Pegno & Kramarsky LLP, New York (Keara A. Bergin
of counsel), for respondents.

Order, Supreme Court, New York County (Eileen Bransten, J.), entered September 20, 2013, which denied defendants' motion, having denominated it one for reargument of a prior order, same court and Justice, entered May 30, 2012, granting plaintiff Todd Roberts' motion for advancement of litigation costs in an underlying action, unanimously modified, on the law, defendants' motion deemed one for renewal, renewal granted, and upon renewal, the prior order adhered to, and as so modified, affirmed, without costs.

Upon their motion for renewal, defendants submitted a letter and email from the Texas Treasury Safekeeping Trust Company (Texas Trust) regarding its view on the propriety of advancing litigation costs in this action and an underlying action from defendant Aegis Texas Venture Fund II, LP (Texas II Fund), a Texas certified capital company (CAPCO) fund. The letter and email were dated subsequent to the prior order granting plaintiff Todd Roberts' motion to compel defendants to advance him $95,494.71 in litigation costs pursuant to defendants' operating agreements and an order of the Supreme Court entered November 16, 2010. Thus, the letter and email constituted "new facts" and the motion properly sought renewal (CPLR 2221[e]).

Defendants' arguments, however, were not directed at the $95,494.71 in litigation costs that the prior order directed them to advance to Roberts. Rather defendants' arguments are directed at their advancement obligation generally which was not the subject of the prior order from which they sought renewal but of the Supreme Court's November 16, 2010 order which is not at issue on this appeal. We further note that the letter and email from the Texas Trust do not provide definitive guidance that it is not possible for the Texas II Fund to make advancement payments to Roberts or his counsel without expending assets of the fund in violation of Texas law, as defendants assert. Rather, the letter explicitly states that the Texas II Fund "may be in violation of the [state's] CAPCO laws."

To the extent that defendants object to specific advancement requests in the future, the Supreme Court has outlined a procedure in the prior order for raising any such objections.

THIS CONSTITUTES THE DECISION AND ORDER
OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT. [*2]

ENTERED: APRIL 22, 2014

CLERK