Board of Directors of Windsor Owners Corp. v Platt

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Board of Directors of Windsor Owners Corp. v Platt 2018 NY Slip Op 31600(U) July 10, 2018 Supreme Court, New York County Docket Number: 155985/2014 Judge: Jennifer G. Schecter Cases posted with a "30000" identifier, i.e., 2013 NY Slip Op 30001(U), are republished from various New York State and local government sources, including the New York State Unified Court System's eCourts Service. This opinion is uncorrected and not selected for official publication. [*FILED: NEW YORK COUNTY CLERK 07/13/2018 10:18 AM 1] NYSCEF DOC. NO. 1471 INDEX NO. 155985/2014 RECEIVED NYSCEF: 07/13/2018 SUPREME COURT OF THE STATE OF NEW YORK . COUNTY OF NEW YORK: PART 54 -----~---------------------------------------x BOARD OF DIRECTORS OF WINDSOR OWNERS CORP., Index No.155985/2014 Plaintiff, -againstELAINE PLATT, Defendant. ---------------------------------------------x JENNIFER G. SCHECTER, J.: Defendant Elaine Platt (Platt) moves to renew her cross motion for summary judgment, which sought dismissal of plaintiff's only remaining claim--its third cause of action, alleging breach Directors established of of fiduciary Windsor that it Opposition [Opp), Ex ~7 duty--because Owners suffered Corp. (Windsor) damages [Prior Order)). the Board had (Affirmation of not in Windsor opposes the motion. The motion is granted and the third cause of action is dismissed. Background Familiarity with the underlying facts of this action is presumed. In motion sequence number 025, relevant part, breach of Platt cross moved, in for summary judgment dismissing plaintiff's fiduciary duty claim "without prejudice as premature" because the damages were too speculative (NYSCEF Doc. Nos. 916 at 13, 664 at 2-3). 2 of 7 That motion was submitted [*FILED: NEW YORK COUNTY CLERK 07/13/2018 10:18 AM 2] INDEX NO. 155985/2014 NYSCEF DOC. NO. 1471 RECEIVED NYSCEF: 07/13/2018 over a year and a half ago in November 2016 while discovery Platt's cross motion was denied because, was still ongoing. at that stage and on that "bare record," the court could not conclude "as a matter or law that any and ~t damages [were] speculative" (Prior Order all potential 14). Platt appealed and the Appellate Division affirmed the 2016 determination burden. based on Platt' s failure to carry her The Court, moreover, stated that Windsor "will likely incur damages in defending the action by [Mazzocchi] brought against the board and potentially if there [Mazzocchi's] favor" Meanwhile, (161 AD3d 637 [1st Dept 2018)) however, on November 7, Platt's cross-motion had been of issue [NOI] announcement s~bmitted, it was now ready 2017--a year after Windsor filed a note Based on plaintiff's (NYSCEF Doc No 1244) . that is an award in for trial, the court authorized this motion to renew because it had not yet seen proof of any actual damages. The court wanted to be sure that there was a cause of action to be ~ried (Opp, Ex A at 1). Plaintiff has taken the position that its damages are: "attorneys fees incurred in defending against Platt's action and the attorneys' fees incurred in prosecuting this action and responding to multiple frivolous motions and appeals made by Platt that resulted in about 17 orders against her, documented in the . motion for attorneys' 2 3 of 7 as fees incurred [*FILED: NEW YORK COUNTY CLERK 07/13/2018 10:18 AM 3] NYSCEF DOC. NO. 1471 INDEX NO. 155985/2014 RECEIVED NYSCEF: 07/13/2018 related. to the contempt finding" (Opp, Ex A at 2 [quoting Affirmation in Support of Motion Sequence Number 032 at <JI 20[c]). 1 In support of her p6st-NOI motion, Platt urges that damages is an element of breach of fiduciary duty and that Windsor has failed to show any actual damages resulting from he~ disclosure (Affidavit in Support [Supp] at 2, 4-6). She points out that Windsor's attorneys' fees in this case are not recoverable as damages (id. at <JI<][ 60-78) . . In opposition, ptaintiff explains that it has incurred "hundreds of thousands of dollars in attorneys' fees with respect to the entirely frivolous motion and appellate practice engaged in by Platt; and her impermissible, confidential improper, and willful disclosure of has assisted an existing adversary cornmunica~ions of the Cooperative and plaintiff, and has also led to the incurring of additional attorneys' fees" (Opp at CJ[ 5). Analysis Damages is an essential element of breach of fiduciary duty and a ·plaintiff alleged was the must establish the misconduct direct and proximate cause of the losses 1 that Concerned about whether plaintiff has recoverable damages, the court specifically directed plaintiff's counsel to e-file an affirmation related to damages it claims within 10 days of March 30, 2018 (Opp, Ex A). Plaintiff failed to do so. 3 4 of 7 [*FILED: NEW YORK COUNTY CLERK 07/13/2018 10:18 AM 4] INDEX NO. 155985/2014 NYSCEF DOC. NO. 1471 RECEIVED NYSCEF: 07/13/2018 claimed (Laub v Faessel, 297 AD2d 28, 30-31 [1st Dept 2002]). In fact, a breach of fiduciary duty claim is not enforceable until the aggrieved party sustains actual damage (IDT Corp. v Morgan Stanley Dean Witter & Co., 12 NY3d 132, 140 [2009]). Plaintiff maintains that its damages fall into two categories: a. "the attorneys' fees incurred in having to defend against a new state court action that in part is based upon Platt's improper disclosu~e of confidential communications. That same disclosure can also be used by the same plaintiff [Mazzocchi] in a pre-existing federal discrimination action. Plaintiff has already incurred attorneys' fees directly related to the improper disclosure. While the full amount of the damages plaintiff may suffer is dependent upon the trial of that federal action, as this court has repeatedly held, and panels of the Appellate Division have also held, that is a viable claim not dismissible on summary judgment; and b. "Plaintiff's right to seek sanctions against Platt for her entirely frivolous and baseless more than four year li tiga ti on onslaught in this court and on appeal" (Opp at ~ 6) . The second purported category of "damages" for breach of fiduciary duty can easily be dispensed with. This court already dismissed plaintiff's independent cause of action for sanctions sanctions, and, to the extent that plaintiff moved for its motions have been addressed on a motion by motion basis (Opp, Ex 17 at 7). 4 5 of 7 Sanctions for frivolous [*FILED: NEW YORK COUNTY CLERK 07/13/2018 10:18 AM 5] INDEX NO. 155985/2014 NYSCEF DOC. NO. 1471 RECEIVED NYSCEF: 07/13/2018 litigation, which are available by motion, are not recoverable under the guise of damages for breach of fiduciary duty. Though in theory it is plausible that plaintiff could sustain damage explains how as the a result cause of of Platt' s action disclosure has survived despite certifying its readiness for trial, shown that it actually sustained· any (which to date), Windsor has not monetary damages resulting from Platt's revelation of privileged information. Significantly, Windsor has not demonstrated that it incurred extra attorneys' fees as a consequence of the disclosure that it would not have incurred in the absence of the disclosure. Nor has it shown that it is actually any worse off in the federal or revealed. 2 state-court . litigations because of what Platt Though plaintiff is certainly not required to show the full extent of its damages if they are ongoing, it has to show some actual damage that it sustained as a result of Platt's alleged breach as opposed to costs that it would have expended anyway defending Mazzocchi' s absence of Platt's disclosures. 2 cases even in This is particularly true The state-court action has been marked disposed for over a year and the "parties may move to reinstate the action when or if necessary" (NYSCEF Doc No 891). 5 6 of 7 the [*FILED: NEW YORK COUNTY CLERK 07/13/2018 10:18 AM 6] NYSCEF DOC. NO. 1471 INDEX NO. 155985/2014 RECEIVED NYSCEF: 07/13/2018 where, as here, Windsor completed discovery, filed its NOI and certified that it is ready for trial. 3 This decision in no way minimizes that Platt revealed privileged information to third parties. been issued against her, An injunction has she has been held in contempt for violating it and she has been sanctioned. That, however, does not change the fact that plaintiff had the burden--albeit a minimal one--to come forward and establish that ii suffered actual damage. It failed to do so in opposition to this motion. Accordingly, ,it is ORDERED that defendant's motion to renew is granted and, on renewal, summary judgment is awarded to defendant on plaintiff's third (and only remaining) cause of action and the Clerk is directed to enter. judgment ....-· accordingly without costs. This is the decision and the court. Dated: July 10, 2018 HON. JENNI 3 SCHECTER The trial did not proceed in June, as planned, specifically so that the court could ascertain whether there are any provable damages in the first place. 6 7 of 7

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