Oasis Sportswear, Inc. v Rego

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Oasis Sportswear, Inc. v Rego 2008 NY Slip Op 33650(U) July 2, 2008 Supreme Court, New York County Docket Number: 115500/07 Judge: Marilyn Shafer 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 PRESENT: PART .- . . Index Number : 115500/2007 OASIS SPORTSWEAR INC INDEX NO. vs MOTION DATE REGO, PATRICIA ~ Sequence Number : 001 MOTION S'EC!. N O . DISMISS ACTION MOTION CAL. NO. were reaa on rnis motion to/for T h e following papers, numbered I t o * PAPERS NUMBERED Notice of M o t i o n / Order t o Show Cause .. . A n s w e r i n g Affidavits m- - Affidavits - Exhibits ... flk 3 - Exhibits Replying Affidavits c Y - , - , \r. Cross-Motion: a y e s G. 'No Upon t h e foregoing papers, it is ordered t h a t this motion J. s.c. Check one: & FINAL DISPOSITION Check if appropriate DONOTPOST / NON-FINAL DISPOS TION RJ3FERlZNCE [* 2] SUPREME COURT OF THE STATE OF NEW YORK - NEW YORK COUNTY HON. MARILYN SHAFER PRESENT: PART 8 Justice OASIS SPORTSWEAR, INC., INDEX NO. Plaintiff, -against- 115500107 MOTION DATE MOTION SEQ. NO. 001 PATRICIA REGO, PAT REGO CONSULTING, INC., and PAT REGO, INC., MOTION CAL. NO. Defendants. PATRICIA REGO, and PAT REGO CONSULTING, INC., Third-party Plaintiffs, -againstJOSPEH TRACHTMAN, Third-party Defendant. The following papers, numbered 1 to 6, were read on thls petition under Article 78 of the Civil Practice Law and Rules: Notice of Motion, Affirmation - Exhibits Memorandum of Law 3 Notice of Cross-Motion, Affirmation - Exhibits Memorandum of Law Cross-Motion: qYes 4,5 6 n NO Page 1 of 4 [* 3] Upon the foregoing papers, it is ordered that the motion and crossmotion are denied. This is a dispute between a women s clothing merchandiser and a former employee. The ernploycr moves to dismiss, in part, counterclaims asserted by the employee against its principal. The employee cross-moves to compel discovery. The record shows that the defendant, Pat Rego, was employcd by the plainti ¬f, Oasis Sportswcar, for almost ten (10) years without a written contract. She was compensated for her services through her corporation, Pat Rego Consulting, Inc. When she left Oasis she h n e d Pat Rego, Inc. to continue to do business in the womcn s apparel industry. Oasis initiated an action against Rego and her corporations for: (1) breach of fiduciary duty against Rego and Rego Consulting; (2) Udair competition against all defendants; (3) unjust enrichment against all defendants; (4)injunctive relief; ( 5 ) money had and received against Rcgo and Rego Consulting (compensation overpayment 2006) ; and (6) money had and received against Rego and Rcgo Consulting (compensation overpayment 2007). Defcndants counter-claimed against Oasis and Joseph Trachtman, Oasis president and sole shareholder for: (1) breach of contract; (2) unjust enrichment; (3)fraud; and (4) an accounting against Oasis only. Oasis moves to: (1) dismiss Pat Rego, Inc. as a third-party plaintiff and counter-claimant; (2) dismiss the first and sccond counterclaims against Trachtman; and (3) dismiss the third and fourth counterclaims on the following grounds: (1) Oasis never contracted with Pat Rego, Inc., which did not exist until after Page2of 4 [* 4] Rego left Oasis. (2) Rego failed to plead facts to substantiate a claim for piercing the corporate veil, the only theory undcr which liability could be imposed against Trachtman personally. (3) The third cause of action, Fraud, does not lie where the allegations are merely duplicativc of the breach of contract claim. (4)Defendants are not entitled to an accounting because there is not a fiduciary relationship between the parties. Defendants filed an amended answer, voluntarily removing Pat Rego, Inc. as a third-party plaintiff, and adding allegations regarding Trachtman s co-mingling of Oasis funds with his own and the absence of any corporate formalities. Plaintiff urges this Court to disregard defendants amended pleading due to its untimely service, 10 days too late to be served as of right. In the alternative, plaintiff argues the amended pleading fails to correct the pleading deficiencies. It is well-settled that on a motion to dismiss pursuant to CPLR 321 1, a pleading shall be liberally construed and will not be dismissed for insufficiency merely because it is inartistically drawn. (Foley v D Agnstino, 2 1 AD2d 60 [ 1st Dept 19641) The relevant inquiry is whether the requisite allcgalions of any valid cause of action cognizable by the state courts can be fairly gathcred from the lour comers of the complaint (Id,). Defects shall be ignored i1.a substantial right of a party is not prejudiced. (21 AD2d at 65). The court must accept the facts as alleged in the pleading to be true and accord the non-movants the benefit of every possible favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory. (Leon v Murtinez, 84 NY2d 83 [1994]) Ch. 1 Pg. 3 [* 5] Upon review of the amended third-party complaint, this Court finds that defendants' causes of action are sufficiently stated. Accordingly, the motion is denied. The cross-claim is denied as moot. We have considered thc other arguments of the parties and find them to be without merit. This Court notes that Mr. Trachtman and Ms. Rego are very angry with each other. It is hoped that they will, in the future, seek modes of resolution other than inconsequential motion practice. Accordingly, it is Ordered that the motion is denied; and it is further Ordered that the cross-motion is denied. This reflects the decision and order of the court. Dated: ,/7,/ud Check one: [XI FINAL DISPOSITION 7 [ ] NON-FI Ch. 1 Pg. 4 L DISPOSITION

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