Getzel Schiff & Ross, LLP v Mach One Consultants, LLC
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Getzel Schiff & Ross, LLP v Mach One Consultants, LLC 2011 NY Slip Op 32715(U) October 14, 2011 Supreme Court, Nassau County Docket Number: 001323-11 Judge: Timothy S. Driscoll 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] 5 eft,) SUPREME COURT- STATE OF NEW YORK SHORT FORM ORDER Present: RON. TIMOTHY S. DRISCOLL Justice Supreme Court -------------------------------------------------------------------Jr GETZEL SCIDFF & ROSS, LLP Plaintiff TRIAL/IAS PART: 20 NASSAU COUNTY Index No: 001323- Motion Seq. No: 1 Submission Date: 9/13/11 - against - MACH ONE CONSULTANTS, LLC, ROBERT M. FEIN & COMPANY CPA' S, PLLC, and JOEL R. MACHER, Defendants. --------------------------------------------------------------------Jr The following papers having been read on this motion: Notjce of Motion , Affidavit in Support, Exhibits and Memorandum of Law........ Affirmation in Opposition, Affidavit in Opposition and EJrhibits......................... Affirma tio n in Rep Iy This matter is before the cour on the motion fied by GSR" or " Plaintiff' ) on July 20 Plaintiff Getzel Schiff & Ross , LLP 2011 and submitted on September 13 set forth below, the Cour denies Plaintiff s 2011. For the reasons motion. BACKGROUND A. Relief Sought Plaintiff seeks an Order disqualifying the law firm of Steven H. Sewell .from representing the Defendants in ths B. The Paries ' , PC (" Sewell" matter. History The Verified Complaint (" Complaint") (Ex. C to to Sewell Afl. in Opp. ) alleges as [* 2] follows: First Cause of Action On or about May 6 , 2004 , Defendant Mach One Consultats , LLC ("Mach One ) entered ) with GSR to rent offce space. Rental payments were made both by Mach One and Robert M. Fein & Company, CP As , PLLC ("Fein ), an entity into a written sublease agreement (" Sublease believed to be controlled by the principals of Mach One. Although the Sublease was in the . name of Mach One , both Mach One and Fein occupied and enjoyed the use of the Sublet premises ("Pre ises ). Pursuant to the terms of the Sublease ,. Mach One was to make base rent payments to GSR in the amount of $42 500 monthy. In addition , Mach One was responsible for additional rent in the form of additionally rented office equipment. By wrting dated March 1 , 000 anually, or $3 2009 , Mach One notified GSR that it would be extending the Sublease through April 30 , 2014 ("Extension about June 13 ), pursuat to Paragraph 33 of the Sublease. On or 2010 , Mach One , though its " alter ego " Fein (Compl. at 14), made a final Sublease payment to GSR but has made no fuher payme1!ts. On or about May 21 2010 , Mac!? One , through Fein , notified GSR that it would terminate the Sublease on June 30 , 2010 , allegedly in violation of the terms of the Sublease. GSR has been unable to rent the Premises to another subtenant. Plaintiff alleges that, in reliance on the Extension and the representations of Defendant Joel R. Macher ("Macher ), Plaintiff declined qualified alternate subtenants for the Premises and continued its lease with its Landlord for the Premises. Plaintiff alleges that , as a result, Mach One breached its contract with GSR. Second Cause of Action Plaintiff alleges that, as a result of the conduct outlned in the First Cause of Action breached its contract with GSR. , Fein Third Cause of Action Plaintiff alleges that, as a result of the conduct outlined in the First Cause of Action Mach One has been unjustly enriched. Four Cause of Action Plaintiff alleges that , as a result of the conduct outlined in the First Cause of Action , Fein ) (" [* 3] has been unjustly enriched. Fifth Cause of Action Plaintiff alleges that Macher, by virtue of his alleged misrepresentations in connection with the Extension, committed fraud on Plaintiff. In his Affidavit in Support of the instant motion , Stephen A. Ross (" Ross ), a parner in the Plaintiff accounting firm , affirms that in or about May of 20 1 0 , he consulted with Sewell regarding a parership dispute (" Prior Dispute ). The Prior Dispute involved Ross dissatisfaction with his parership income , and his belief that he was entitled to more money. Ross afrms that he provided Sewell with copies of the parnership s original and amended parership agreement , and' Sewell subsequently wrote a letter to GSR on Ross ' behalf dated October 27 2010 (Ex. A to Ross Aff. in Supp. ). In the October Letter, Sewell advised GSR that he had been retained by Ross " in connection with the parnership of (GSR)" and requested the opportunty to discuss the amended parnership agreement with GSR and its counsel. Ross affirms that, in cO nnection with the Prior Dispute , he also discussed with Sewell the sources of the parership s income , including active matters for which GSR was biling on a monthy basis. Sewell subsequently drafted a letter dated December 8 , 2010 to GSR (Ex. B to Ross Aff. in Supp. ) in which Sewell submitted comments on Ross ' behalf regarding the amended parership agreement, as GSR had requested. GSR and Ross subsequently resolved the Prior Dispute. On or about Janua 1 2011 , Sewell provided Ross with an invoice for his services (id. at Ex. C), which Ross paid. On or about Februar 2 2011 , Plaintiff commenced ths action (" Instat Action ). On or about Februar 24 2011 , Sewell provided Ross with a letter (Ex. D to Ross Aff. in Supp. ) that was addressed to Ross at his home , and was also sent to Mach One to the attention of Macher and to Fein to the attention of Robert M. Fein (" Mr. Fein Waiver Letter ). In the Waiver Letter, Sewell advised the recipients that "In my opinion , I could not represent the Defendants while I stil represented (Ross). Furhermore , in my opinion , even if I no longer represented (Ross), I could not represent the Defendants in this lawsuit without the express wrtten (Ross) permitting me to do same. " The Waiver consent of Letter also provided as follows: If it is acceptable to each of you that I represent the Defendants in the above captioned matter, despite my representation of (Ross), a parer with (GSR), I request that each of [* 4] you sign your name below, indicating your agreement, scan and retu the complete document.. to my bye-mail as soon as possible. Upon my receipt of a signed copy from each of you , my representation of the Defendants shall begin, and my representation of (Ross) shall end during the pendency of ths lawsuit. In his Affirmation in Opposition , Sewell affirms that; in connection with his "brief' representation of Ross in the Prior Dispute ("Prior Representation Ross provided him with a " limited number of dDcuments the original parership agreement from 2004 and 4), ) (Sewell Aff. in Opp. at Those documents consisted of (id.). the proposed amended agreement. Ross affrms that he did not receive or review any of GSR' ta retus , financial records , or any other internal documents. Durng the Prior Representation , the only correspondence that he sent to GSR was the two letters to which Ross refers in his Affdavit, and Sewell did not receive a response to those letters. Moreover, Sewell never spoke or met with anyone associated with GSR, GSR' s curent attorney or any other attorney on GSR' s behalf. In late December 2010 to early Januar 2011 , Ross " decided to put things on hold" (id. at 7) and Sewell provided no fuer legal services to Ross after that time. Based on his belief that it was appropriate for Ross , Mr. Fein and Macher to authorize Sewell to represent Defendants in this action, Sewell prepared the Waiver Letter which Ross , Mr. Fein and Macher signed (Sewell Aff. in Opp. at Ex. E). As reflected in the Waiver Letter , Sewell was not concerned about a conflct caused by facts he obtained durng the Prior Representation but rather wanted to address the fact that Ross was aparner in GSR, and Sewell would be asserting positions adverse to GSR in the Instant Action. In reply, Plaintiff submits that information , including the income stream of GSR, was divulged durng the Prior Representation. Plaintiff contends that this information is relevant to the Instat Action , in par because it may include details regarding Plaintiffs income from real estate holdings and rent , which are pertinent to the Instat expenditures and Action involving a landlord-tenant dispute. Plaintiff also disputes Defendants ' claim that Plaintiff has delayed in filing its motion, and suggests that the Waiver Letter constitutes an acknowledgment by Sewell of a confict of interest. C. The Paries ' Positions Plaintiff submits that it has demonstrated its right to disqualification of Sewell as counsel [* 5] for Defendants by establishing that 1) the Prior Representation existed; 2) the Prior Representation and Instant Action are substantially related given that "the income stream of (GSR) is encompassed in the claims of the Plaintiff' (P' s Memo. of Law); and 3) the interests of Defendants and Ross are mutually adverse. Defendants oppose Plaintiffs motion , submitting that there is " absolutely no relationship " between the Prior Representation and the Instant Action (Sewell Aff. in Opp. at' 14). Defendants note that Ross has not alleged that he and Sewell discussed the landlord-tenant dispute at issue in the Instat that , given Plaintiffs delay in Prior Representation. Defendants also argue Action durng the filing the instat motion , it is apparent that the motion is an effort to deny Defendants the right to counsel of their choice. RULING OF THE COURT A par' s valued right to be represented in ongoing litigation by counsel of its own choosing should not be abridged, absent a clear showing that disqualification is waranted. v. Municipal Information Services, Inc. 282 A.D. 2d 712 (2d Dept. 2001), citing of Fishkill 258 A. 2d 447 (2d Dept. 1999); Feeley v. also S & S grounds for the disqualification Tekni-Plex, Inc. v. Meyner and Landis 89 N. Y.2d 123 , 131 (1996), of Defendant's counsel. 89 N. Olmoz:v. Town Midas Props. 199 A.D.2d 238 (2d Dept. 1993). Accordingly, the movant has the burden of establishig rearg. den.. Horn 2d 917 (1996); Hotel Ventures, Solow WR. Grace Co. 83 N. Y.2d 303 v. Ltd. Partnership 308 (1994); see H Corp. 69 N. Y.2d 437 445 (1987). A v. 777 S. par seeking disqualification of opposing counsel must establish that (1) there is a prior attorney- client relationship between the moving par and opposing counsel; (2) the matters involved in both representations are substatially related; and (3) the interests of the curent MA. C. Duff Inc. V. ASMAC, LLC 61 A.D client and former client are materially adverse. 828 (2d Dept. 2009) citing Tekni-Plex, Inc. v. Meyner and Landis, supra Calandriello 32 A. D.3d450 , 451 (2dDept. 2006); Supply Corp. at 131; Columbus Constr. Co. , Inc. Calandriello v. Petrilo Bldrs. 20 A. D.3d 383 (2d Dept. 2005). When the moving par can demonstrate each of these factors , an irrebuttable presumption of disqualification follows. 98 (1st Dept. 2008), citing Pellegrino Tekni-Plex, Inc. v. v. Oppenheimer Co. , Inc. 49 A.D.3d 94 Meyner and Landis, supra at 131. Conversely, [* 6] the movant' s failure to make the requisite showig presumption arses. Teacher s Ins. Landis , supra Peilegrino v. Annuity Assn. Co. , Inc. , supra at p. 98 , citing Oppenheimer 93 N. Y.2d as to ea h of the criteria means that no such 611 617 (1995); Tekni-Plex, Inc. v. Kassis Meyner and at 132. The Cour denies Plaintiffs motion based on the Cour' s conclusion that the Prior Representation , which involved Ross ' dissatisfaction with his parnership remuneration , and the Instant Action , which is a landlord- tenant matter involving Defendants ' alleged failure to make required payments pursuat to the Sublease , are not substatially related. The Cour notes that Plaintiffhas not alleged that Ross discussed the landlord-tenant matter during the Prior Representation , and is not persuaded that the limited documentation reviewed by Sewell durng the Prior Representation is relevant to the issues in the Instat Action, which relate to whether Defendants breached the Sublease by failng to pay rent. All matters not decided herein are hereby denied. Ths constitutes, the decision and order of the Cour. . The Cour reminds counsel for the paries of their required appearance before the Cour for a Certification Conference on November 17 , 2011 at 9:30 a. ENTER DATED: Mineo1a, NY October 14 , 2011 ENTERED OCT 20 2011 NASSAU COUNTY COUNTY CLERK' S OFFtCE
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