Bregianos v Kosmetech Corp.

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Bregianos v Kosmetech Corp. 2021 NY Slip Op 32496(U) November 29, 2021 Supreme Court, Kings County Docket Number: Index No. 501950/21 Judge: Leon Ruchelsman 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] KINGS COUNTY CLERK 11/29/2021 03:23 PM NYSCEF DOC. NO. 123 INDEX NO. 501950/2021 RECEIVED NYSCEF: 11/29/2021 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF KINGS : CIVIL TERM: COMMERCIAL 8 ------------------ ---------------- ----- X ANTONIA BREGIANOS, derivativ ely on behalf of Kosmetech Corp., Plaintiff, Decision and order Index Nb. 50i950/21 - against KOSMETECH CORP., SECANT LOGISTICS INC.; DIMITRI KONTELEON & HELEN KNOTELEON, Defendant s, -~-- - -- --x -----~~---- . -------PRESENT: HON. LEON RUCHELSMAN November 2 9, 2021 The plaintiff has moved seeking a prelimina ry injunction pursuant to CPLR §6301. The defendant s have oppose?d the motion. Papers were: submitted by the parties and arguments held. After reviewing all the arguments this court now makes the following determina tion. As recorded in a prior order, essential ly, the plaintiff a fifty percent owner of Kosrnetech Corp. has sued the other fifty percent owner, defendant Dimitri Konteleon and his wife alleging they diverted a million dollars from the corporatio n to their own privately owned entity. forms of relief. The plaintiff has now moved seeking two The first is a demand the defendant s return the sum of $Bl, 629. 95 which they allege the defendant s took to pay attorney's fees defending this action. The second is a request enjoining the defendant s frorn incurring any debt and from paying any of Kosmotech 's bills without the express consent of the plaintiff . As note:d the motion is opposed on the grounds it has no merit. 1 of 5 [*FILED: 2] KINGS COUNTY CLERK 11/29/2021 03:23 PM NYSCEF DOC. NO. 123 INDEX NO. 501950/2021 RECEIVED NYSCEF: 11/29/2021 Conclusio ns of Law CPLR §6301, as it pertains to this case, permits the court to issue a prelimina ry injunction "in any action .. , where the plaintiff has demanded arid would be entitled to a judgement restrainin g defendant from the commissio n or the Continuan ce of an act, which; if committed or continued during the pendency of the action, would produce injury to the plaintiff " (id). A party seeking a prelimina ry injunction "must demonstra te a probabili ty of success on the merits, danger of irreparab le injury in the absence of the injunctio n and a balance o.f the equities in its favor" (Nobu Next Door, LLC v. Fine Arts Hosing, Inc., 4 NY3d 839, 800 NYS2d 48 [2005]; see also, Alexandru v. Pappas, 68 Ad3d 690, 890 NY2d 593 [2d Dept., 2009]) . Further, each of the above elements must be proven by the moving party with "clear arid convincing evidence;.; {Liotta V. Mat torte, 71 AD3d 7 41, 9 0 0 NY S :Zd 62 [2d Dept., 20101) . Moreover, the plaintiff also seeks to impose upon the defendant a mandc1.tory injunction requiring them to return corporate fuhds utilized to pay attorneyf s fees. A mandatory injunction is rarely granted and only under unusual circumsta nces to maintain the status quo pending trial (Matos v. City o:f New York, 21 A03d 936, 801 NYS2d 610 [2d Dept..·' 2005]). Thus, where a party is engaged in unla111ful conduct which is continuou s then a mandatory in j unct iort is proper- (Rosen tha 1 v. Helfer, 136 Misc2d 9, 516 NYS2d 1020 (Civil Court New York 2 2 of 5 [*FILED: 3] KINGS COUNTY CLERK 11/29/2021 03:23 PM NYSCEF DOC. NO. 123 INDEX NO. 501950/2021 RECEIVED NYSCEF: 11/29/2021 County; 1987]). Moreover, where a party acts deliberat ely and intention ally which affects the p,laintiff 's rights or where the party engages in unlawful conduct which is capable of repetition then a mandatory injunction requiring the party to cease is like~ise proper (Marcus v. Village of Mamaronec k, 283 NY 325, 2B NE2d 856 [1940], Rombom v. Weberman, 2002 WL 1461890 [Supreme Court Kings Colin t y 2 0 02 l) . In this case the plaintiff has not presented any evidence that mandating the defendant return the attorney's fees is of such unllsUal circumsta nces as to warrant the imposition of the injunction (Zoller v. HSBC Mortgage Corp.. 24 NYS3d 168 [2d Dept., 2016]). (USA), 135 AD3d 932, This is particula rly true since this lawsuit is about wh·ether the defendant s acted properly in their managemen t of the business and whether their defense of Thus, imposing a mandatory this action is therefore proper. injunction would effective ly resolve this portion of the lawsuit, Tn Spectrum Stanford LLC v. 400 Atlantic Title LLC, 162 AD3d 615, 81 NYS3d 5[.lst Dept., 20181 the court stated that "a mandatory injunction should not be granted, absent extraordin ary ci,rcumsta nces, where the status quo would be disturbed and the plaintiff would receive the ultimate relief sought, pendente lite" (id). The plaintiff argues that pursuant to BusinE!ss Corporatio n Law §720; §721, §722, §723 and §724 the defendant s must first obtain the r.:Lght to indemnifi cation either from the 3 3 of 5 [*FILED: 4] KINGS COUNTY CLERK 11/29/2021 03:23 PM INDEX NO. 501950/2021 NYSCEF DOC. NO. 123 RECEIVED NYSCEF: 11/29/2021 corporatio n or by court order (see, Federico v. Brancato, 188 AD3d 1158, 137 NYS3d 502 [2d Dept., 2020]) . While those provision s apply to in<:lividua l directors and officers and not to the c::orporatio n itself being sued derivativ ely there is insufficie nt evidence such expenses were used for attorney' s fees for the individua l de.fendant s and not the corporatio n itself. The entire basis for the mandatory injunction request is based upon a single line item in an income statement termed "Legal Fees- Kosrnetech Corporatio n" (see, Income Statement , submitted as Exhibit 'H' to<p1airi tiff's Order to Show Cause). However, there is no evidence such fees were expendeq. for the individua ls and not the corporatio n. The plaintiff argues the defendant s Used the corporati on's funds to pay the legal fees of the defendant 's other wholly owned entity. Thus, plaintiff asserts "that Kosrnetech has paid the legal fees of the Konteleon is other shell 21). However, entity, Secant" (see, Affirmatio n in Support, '![ that allegation is not substantia ted at all. Further, as ndted, even if the funds were used to defend the individua ls there has been no showing why such mandatory injunction must be issued. Therefore_ , based on the foregoing, the motion seeking to require the return of attorney's fees. is denied. Turning to the request to enjoin the defendant s from acting without the plaintiff 's participa tion, a~ recorded in the prior order, the court already noted the plaintiff 's have not presented 4 4 of 5 [*FILED: 5] KINGS COUNTY CLERK 11/29/2021 03:23 PM NYSCEF DOC. NO. 123 INDEX NO. 501950/2021 RECEIVED NYSCEF: 11/29/2021 ficie nt to anyth ing harm other than money damag es which is insuf obtai n a,ny injun ction . In this motio n, suppo rt for an injun ction is not even argue d at all. Anton ia Breqi anos does asser t that by ''in view of the self- deali ng and unaut horiz ed actio ns defen dants , I fear that defen dants will conti nue to ly, I misap propr iate and diver t corpo rate asset s. Acco rding respe ctful ly reque st that this Court restr ain and enjoi n the etech defen dants , pende te lite;- from using the cred it of Kosm incur ring and/o r makin g or incur ring any credi t card charg es or any prior other liabi lity in the name of Kosm etech witho ut the ng the writt en conse nt of the plain tiff in all insta nces pendi n of Anton ia final deter mina tion of this actio n" (see, Af'fir matio Bregi anos, 'll43) . Howe ver, simpl y alleg ing corpo rate funds are harm being diver ted, eveh if true, is hot an irrep arabl e warra nting an injun ction . At root, those alleg ation s are mere injun ction . money Claim s which ca,nno t suppo rt the grant ing of any There fore, based on the foreg oing, the motio n seeki ng injun ction is denie d. So order ed. ENTER: DATED: Novem ber 29, 2021 Brook lyn N.Y. Hon. Leon Ruche lsman JSC 5 5 of 5 any

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