Ramax Search, Inc. v Dersovitz

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Ramax Search, Inc. v Dersovitz 2020 NY Slip Op 32199(U) July 6, 2020 Supreme Court, New York County Docket Number: 652137/2019 Judge: Debra A. James 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: 1] NEW YORK COUNTY CLERK 07/06/2020 04:45 PM INDEX NO. 652137/2019 NYSCEF DOC. NO. 37 RECEIVED NYSCEF: 07/06/2020 SUPREME COURT OF THE STATE OF NEW YORK. NEW YORK COUNTY PRESENT: lAS MOTION 59EFM PART HON. DEBRA A. JAMES Justice X ----------------------------------------------------------------------RAM AX SEARCH, INC., INDEX NO. 652137/2019 MOTION DATE Plaintiff, 11/14/2019 MOTION SEQ. NO. 001 -vRONI DERSOVITZ, RD LEGAL FUNDING, LLC,RD LEGAL GROUP, LLC,RD LEGAL FINANCE, LLC, and RD LEGAL CAPITAL, LLC, DECISION + ORDER ON MOTION Defendants. ---------------------------------------------------------------------------- X The following e-filed documents, listed by NYSCEF document number (Motion 001) 13, 14, 15, 16, 17, 18,19,20,21,22,23,24,25,26,27,28,29,30,31,33,34,35 DISMISSAL were read on this motion to/for ORDER Upon the foregoing ORDERED complaint that that the complaint with notice pre-answer defendants within motion are directed to serve dismiss the an answer and it is further that counsel conference are directed to appear via Skype For Business form by any counsel for a virtual on August 20. request for at least two days in advance of such date. 652137/2019 RAMAX SEARCH, Motion No. 001 to 20 days after service of a copy of this order 2020, at 11:00 AM upon the filing of the standard conference to and it is further of entry; ORDERED preliminary defendants' is denied; ORDERED documents, INC. vs. DERSOVITZ, RONI 1 of 11 Page 1 of 11 [*FILED: 2] NEW YORK COUNTY CLERK 07/06/2020 04:45 PM INDEX NO. 652137/2019 NYSCEF DOC. NO. 37 RECEIVED NYSCEF: 07/06/2020 DECISION In this action to enforce dismiss a judgment, the complaint a cause of action, Plaintiff Factual officer a pre-answer motion to fails to state and lack of jurisdiction. Background agreement with Pursuant candidate, Ramax defendant Search, financial Inc. entered RD Legal Funding, to the terms of the placement Linda Group, Zheng was (RD agreement financial LLC, in its New York office (RD Legal officer of RD Legal hired LLC into as chief In a public hiring announcement, chief veil in order such motion. of RD Legal Group). make evidence, 16, 2015, plaintiff Legal Funding).l plaintiff's defendants the corporate on the grounds that plaintiff and Procedural a placement to pierce documentary opposes On June as seeking Linda Zheng was announced Capital, LLC (RD Legal Capital) . On December 27, 2016, plaintiff action against RD Legal Funding commenced seeking a breach of contract payment pursuant to the Plaintiff herein notes that in 2018, the Consumer Financial Protection Bureau and the New York Attorney General filed a law suit against RD Legal Funding, RD Legal Finance, LLC, nonparty RD Legal Funding Partners, LP, and Roni Dersovitz alleging that they scammed 9/11 first responders and NFL concussion victims out of money intended to cover medical costs, lost income and other critical needs, by luring them into costly advances on settlement payouts by lying about the terms of the deals (see complaint paragraph 16). The action referred to in this paragraph of the complaint is pending in New York County Supreme Court under People of the State of New York v RD Legal Funding, Index No. 452091/2018 (S~hecter, J). 1 2 of 11 .e:1:"4"1"7''''ft4Q OAUAY Q.CACt'U ••••,.. \,let n~g~nVIT7 AnN I [*FILED: 3] NEW YORK COUNTY CLERK 07/06/2020 04:45 PM INDEX NO. 652137/2019 NYSCEF DOC. NO. 37 RECEIVED NYSCEF: 07/06/2020 placement agreement. On February in favor of plaintiff 7, 2018, a judgment in that action, in the. amount of $142,298.84. To date, only $4,715.53 of such judgment a marshal's of RD Legal Funding. garnishment On April 11, 2019, Roni Dersovitz Legal plaintiff (Dersovitz), Finance,LLC (RD commenced RD Legal Legal has been paid, this Funding, Finance), RD Legal and RD In its complaint, Group are New company, alleges York companies, alleges RD Legal that Dersovitz is a resident Capital of New and RD Legal Funding and Legal is a New and RD Legal Finance is a Delaware company. firm office Jersey The complaint Jersey, with a law in New York. The complain and involvement asserts among The complaint officer~, employees, without to corporate claims and that each is also alleges and control The complaint that Dersovitz including business intellectual property, entities, RD the opportunities, regard has substantial all use the same trademark, an agent for the other. assets that Dersovitz in all of the RD entities. that the RD entities moves RD Legal RD plaintiff is the sole member of RD Legal Funding that Group, Capital that Dersovitz alleges against Legal RD Entities) . The complaint following action (collectively, Finance. was entered form or formality rendering each its alter ego. The complaint an advance RD claims that on May 25, 2016, in satisfaction Legal 652137/2019 RAMAX SEARCH, Motion No. 001 Funding INC. VS. DERSOVITZ, made RONI 3 of 11 to a September 11th of Victim Page 3 of 11 [*FILED: 4] NEW YORK COUNTY CLERK 07/06/2020 04:45 PM INDEX NO. 652137/2019 NYSCEF DOC. NO. 37 RECEIVED NYSCEF: 07/06/2020 Compensation improperly advance Fund claimant, directed Voss In its Dersovi tz has paragraph first companies, without judgment. Plaintiff Funding of the Voss rather than RD Legal Funding 13). cause moved defendants (Voss), RD Legal that the funds due in satisfaction be paid to RD Legal Finance, (see complaint, named Jason of action, assets from RD due consideration, the plaintiff Legal alleges Funding to to avoid paying to plaintiff other plaintiff's states that due to the foregoing, is liable his that. each of the for the RD Legal Funding judgment. The complaint's .seeking to pierce second cause of action the corporate and revenues is a cause veil on the grounds that Dersovitz shielded profits judgment proof. The exercised dominion and control over the assets of RD Legal Funding, complaint and all of the RD entities, Funding from RD Legal of action also thereby Funding alleges moving to render that assets it Dersovitz from RD Legal to other RD entities. Defendants make this p~e-answer motion seeking to dismiss \ the complaint (7), plaintiff the corporate an advance with on grounds to CPLR section has failed to state a cause of action veil. on Voss's RD Legal that, pursuant Defendants September Finance, not 3211 for piercing also argue that the agreement 11th Victim RD Legal Compensation Funding (a) for claim was (see Kanefsky aff, / exhibit B), and therefore 652137/2019 RAMAX SEARCH, Motion No. 001 INC. VS. payment DERSOVITZ, to RD Legal RONI 4 of 11 Finance was proper. Page 4 of 11 [*FILED: 5] NEW YORK COUNTY CLERK 07/06/2020 04:45 PM INDEX NO. 652137/2019 NYSCEF DOC. NO. 37 RECEIVED NYSCEF: 07/06/2020 Finally, defendants pursuant to CPLR because RD Legal entities 3211 In opposition of Tannenbaum its Linda jurisdiction and RD Legal is a resident that the writing chief New office of Linda evidence of RD that Legal involved concludes in directing that suit his needs, avoid paying officer Moreover, as' being and VS. used that, such in offers letter, affiliates" as the chief argues acted (see this common RD Legal is unit, Moreover, to RD Legal Finance. the assets financial that as one officer. advance, when Funding was Tannenbaum interchangeably of RD Legal Funding judgment. Discussion INC. RD in the public announcement, uses the RD entities and to reduce 652137/2019 RAMAX SEARCH, Motion No. 001 In "its hired RD entities the payment plaintiff's further job. Tannenbaum for the Vo~s Dersovitz and and that Dersovitz with one chief financial the payoff the affidavit, plaintiff He states Group, Capital. the various interchangeably, receiving Legal was described submits Zheng was hired to be the CFO in the aff, exhibit B). Zheng officer RD York not New York. In his between New on behalf of RD Legal Funding, financial that Linda not plaintiff Tannenbaum. interchangeably. states Tannenbaum motion, Peter are of New Jersey, the transaction Dersovitz York Finance was a New York transaction, Dersovitz, Zheng (a) (8) for lack of personal to defendants' all the RD entities a letter, be dismissed president argues Legal Funding should Capital and Dersovitz affidavit I that the complaint argue DERSOVITZ, RONI 5 of 11 \ Page 5 of 11 to to [*FILED: 6] NEW YORK COUNTY CLERK 07/06/2020 04:45 PM INDEX NO. 652137/2019 NYSCEF DOC. NO. 37 RECEIVED NYSCEF: 07/06/2020 On a motion to dismiss, the facts alleged 'in the complaint may be gleaned 491 from them [1st Dept merits 2009]). must accept and all reasonable (see Amaro The of the complaint court court as true inferences v Gani Realty Corp., is not permitted the that 60 AD3ct to assess or any of its factual allegations, the but may \ only determine inferences elements if, assuming the truth of the facts alleged that can be drawn of a legally cognizable LLC v Brody, 1 AD3d 247, 250 v 43 Ginzburg, NY2d from them, the complaint 268, [1st Dept 2003J, 275 dismissal based on documentary only such "evidence if allegations, conclusively law" v Mutual (Goshen Al though second claim and cause the Dersovi tz, (1 ) corporation Ins. Co. defendant will a defense seeks succeed factual as a matter 98 NY2d of 314,326 complaint has a first the corporate cause of action of action appear veil of the various plaintiff to enforce and and a to assert a RD entities satisfy its RD Legal Funding. piercing the owners iri respect such domination Guggenheimer plaIntiff's of N.Y., the 84 NY2d 83, 88 [1994]) enabling against Generally, that: establishing the the motion refutes states (see Skillgames, citing If evidence, of action,' both causes for piercing judgment [1977]). utterly Life [2002]; Leon v'Martinez, cause of action and any corporate exercised to commit INC. VS. DERSOVITZ, veil 'complete to the transaction was used 652137/2019 RAMAX SEARCH, Motion No. 001 the RONI 6 of 11 requires domination attacked; a fraud a or wrong and showing of the (2) that against Page 6 of 11 the [*FILED: 7] NEW YORK COUNTY CLERK 07/06/2020 04:45 PM INDEX NO. 652137/2019 NYSCEF DOC. NO. 37 RECEIVED NYSCEF: 07/06/2020 ) .' plaintiff Morris which v New York [1993]; Matter AD2d resulted 362, be plaintiff's Dept. of Guptill 364-3365 to Factors State in of Taxation Holding [3d Dept considered Corp. 1970], in inj ury & (see Matter Fin., v State affd 31 determining of 82 NY2d 135 of New York, NY2d whether 897 the 33 [1972]). owner has 1 "abused the privilege include whether formalities, there was inadequate use of corporate v Loupolover, I Group, of doing "failure capitalization, funds 44 AD3d a business for personal Inc. v Park Ave. to Physicians, adhere P.C., [2d Dept 2008]). Mere conclusory statements sustain controlled a cause of action capacity by a shareholder against (see Itamari v Giordan 40 AD3d 407, 407 Here, cause of judgment alleges against has sufficiently for piercing RD Legal exercised 652137/2019 RAMAX SEARCH, Motion No. 001 6, 24 is are to insufficient in its individual 298 AD2d Corp. v South St. Seaport INC. 559, 560 Bath Prods., [2d Inc., Ltd. Partnership, DERSOVITZ, alleged corporate facts veil to support to enforce In its complaint, and RONI 7 of 11 control over all a its plaintiff was the alter ego of the other, dominion VS. the Funding. that each defendant Dersovitz [2d Dept [1st Dept 2007]). plaintiff action 141 that a corporation Dept 2002]; see also AHA Sales, Inc. v Creative 58 AD3d at 24; Andejo LLC see Gateway Inc., 58 AD3d a shareholder Dev. Corp., corporate Constr., 62 AD3d Bath Prods., form" of assets, and [2d Dept 2007]; Inc. v Creative or to (Millenium 2009]; AHA Sales, dominated corporate commingling use" 1016, 1016-1017 in the of that the Page 7 of 11 RD [*FILED: 8] NEW YORK COUNTY CLERK 07/06/2020 04:45 PM INDEX NO. 652137/2019 NYSCEF DOC. NO. 37 RECEIVED NYSCEF: 07/06/2020 entities, and and moved officers. although As assets among evidence of it contracted them including this, Legal Group. plaintiff employees points out that with RD Legal Funding to place Linda Zheng, Linda Zheng was hired and placed RD money, Further, . when as CFO in the New York office Linda Zheng's hiring was of made / public, she Plaintiff also directed despite was who the and plaintiff assets points fact claims of it was RD from contracted all share it from having plaintiff the the RD with advance payoff, Finance for trademark. Finally, RD Legal Funding's the judgment. Funding Defendants which refutes Based facts to support of RD Legal and Dersovitz. evidence that is an agent for the has alleged sufficient RD entities Capital. Funding RD Legal same veil Legal Legal Voss to satisfy the corporate any documentary as a matter CFO that this was done to reduce of piercing the other funds the urges that each entity they to prevent produced the Plaintiff on the foregoing, reach that that Voss that its claim as out received the advance. other announced have to not these allegations of law (see Goshen v Mutual Life Ins. Co. of New York, 98 NY2d at 326 Defendants because there RD Legal that that RONI Motion No. 001 8 of 11 must be dismissed over RD Legal and RD Legal Dersovi tz INC. VS. DERSOVITZ, complaint Defendants and Dersovitz. and RAMAX SEARCH, the jurisdiction that RD Legal Capital companies 652137/2019 argue is no personal Finance, no dispute York also argue that Finance is a resident Capital, there is are not New of New Jersey. Page 8 of 11 [*FILED: 9] NEW YORK COUNTY CLERK 07/06/2020 04:45 PM INDEX NO. 652137/2019 NYSCEF DOC. NO. 37 They RECEIVED NYSCEF: 07/06/2020 contend that jurisdiction to CPLR jurisdiction has purposefully "a substantial 302 transacted [internal quotation marks activities are volitional itself of the privilege thus invoking limited contacts between Spine and do not have within the state and there is the transaction 24 NY3d Inst., citations of conducting benefits and the claim 370, 376 omitted]). activities and [2014] "Purposeful for purposeful the non-domiciliary within protections marks arid citations are required that if the nondomiciliary acts by which the non-domiciliary the (id. [internal quotation to establish business relationship v Laser of omitted]). avails the forum its laws" "More than activities' sufficient transacted business in New (id.). Although jurisdiction Co., courts over a nondomiciliary (Paterno York" York (a) (1), a New York court may exercise asserted" State, New over them in this action. Pursuant personal therefore, it is well established is on the party asserting 178 AD2d pre-answer that "the burden 589, motion 590 [2d Dept lack of jurisdiction "need personal jurisdiction Castillo, 25 AD3d 238, 243 Here, answer motion in view only make exists" a plaintiff to CPLR a prima (Opticare 3211 facie Folder opposing (a) (8) for showing Acquisition a that Corp. v [2d Dept 2005]). of this court's to dismiss plaintiff's 652137/2019 RAMAX SEARCH, Motion No. 001 it" (Roldan v Dexter 1991]), to dismiss' pursuant of proving INC. vs. DERSOVITZ, RONI . 9 of 11 denial of defendants' claim to pierce pre- the corporate Page 9 of 11 [*FILED: 10] NEW YORK COUNTY CLERK 07/06/2020 04:45 PM INDEX NO. 652137/2019 NYSCEF DOC. NO. 37 RECEIVED NYSCEF: 07/06/2020 veil to enforce its judgment against as alter egos of RD Legal Funding, place in this complaint based on lack of personal RD Capital, juncture of RD 171 AD2d 522 jurisdiction corporate over [1st jurisdiction Finance then New York (see generally Dept based insurer's were corporations testimony business that with a this are the alter have personal v Fraser found Assoc., personal by piercing corporate in at is successful will defendant the Dersovitz, denied properly acti vi ties run not over be Corcoran [Court 1991] on must has to dismiss and the RD entities in New York over corporate veil supervised Funding, them motion Notably, .if plaintiff that Dersovitz Legal jurisdiction defendants' RD Legal in the litigation. in demonstrating egos and and the RD entities and the fact that discovery not taken Legal case, Dersovitz the defendants state sufficient. the and that of degree separateness] ) The party jurisdiction "may exist" demonstrated opposing pursuant a motion to dismiss for lack of personal to CPLR 3211 need only demonstrate whereby to defeat the motion. It that facts need not that they do exist; these issues await discovery be (see ./ 652137/2019 RAMAX SEARCH, INC. Motion No. 001 VS. DERSOVITZ, RONI 10 of 11 Page 10 of 11 [*FILED: 11] NEW YORK COUNTY CLERK 07/06/2020 04:45 PM NYSCEF DOC. NO. 37 RECEIVED NYSCEF: 07/06/2020 Peterson v plaintiff has sufficiently establish that New York has jurisdiction Legal INDEX NO. 652137/2019 Finance Spartan Indus., 33 NY2d demonstrated 467 [1974]). Here, that facts may exist which over RD Legal Capital, and Dersovitz. 7/06/2020 J!~ DATE D BRA CHECK ONE: CASE DISPOSED GRANTED APPLICA nON: CHECK IF APPROPRIATE: 463, 0 NON.FINAL DENIED .GRANTED SETILEORDER ~ 652137/2019 RAMAX SEARCH, Motion No. 001 INCLUDES INC. VS. DERSOVITZ, DISPOSITION IN PART SUBMIT ORDER TRANSFER/REASSIGN RONI 11 of 11 ~ FIDUCIARY * ~ A. JA APPOINTMENT A , 9:'5.C. D D OTHER REFERENCE Page 11 of 11 RD

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