Pirs Capital, LLC v MCA Westover Hills Operating Co., LLC

[*1] Pirs Capital, LLC v MCA Westover Hills Operating Co., LLC 2023 NY Slip Op 50741(U) Decided on July 7, 2023 Supreme Court, New York County Lebovits, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on July 7, 2023
Supreme Court, New York County

Pirs Capital, LLC, Plaintiff,

against

MCA Westover Hills Operating Company, LLC,
and JAMES WALESA, Defendants.



Index No. 653276/2022


Foster & Wolkind, P.C., New York, NY (Bryan E. Wolkind of counsel), for plaintiff.

Jacovetti Law, P.C., Garden City, NY (Robert C. Jacovetti of counsel), for defendants. Gerald Lebovits, J.

In this action on a merchant-cash-advance agreement and guarantee, plaintiff, Pirs Capital, LLC, moves under CPLR 3212 for summary judgment against defendant-merchant MCA Westover Hills Operating Company, LLC, and defendant-guarantor James Walesa. Pirs Capital seeks dismissal of defendants' affirmative defenses and entry of judgment in its favor. The motion is denied.

A party bringing a motion for summary judgment "must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to demonstrate the absence of any material issues of fact." (Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986].) Among other things, movant must establish, prima facie, that "the affirmative defenses raised by the opposing party are inapplicable." (South Nassau Med. Grp., P.C. v 105 Rockaway Realty, LLC, 208 AD3d 812, 814 [2d Dept 2022].) Failure to satisfy this prima facie burden "requires a denial of the motion, regardless of the sufficiency of the opposing papers." (William J. Jenack Est. Appraisers & Auctioneers, Inc. v Rabizadeh, 22 NY3d 470, 475 [2013].)

Pirs Capital has not made out the required prima facie showing, for two independent [*2]reasons.

First, Section 4.5 of the agreement between Pirs Capital and merchant provides that the agreement "shall be governed by and construed in accordance with the laws of the State of Florida," excluding conflicts-of-law principles).[FN1] (NYSCEF No. 16 at 6 § 4.5.) But Pirs Capital provides no Florida authority on this motion—statutory, decisional, or otherwise—to support its claims against defendants or its request for summary judgment. Absent any showing by Pirs Capital that it is entitled under Florida law to summary judgment, it has not met its prima facie burden.

Second, defendants' answer asserts the affirmative defense of lack of personal jurisdiction. (NYSCEF No. 3 at ¶ 26.) Pirs Capital has not shown that this defense is inapplicable. Pirs Capital advances two grounds for dismissal of this defense: (i) Personal jurisdiction exists because defendants were properly served (see NYSCEF No. 11 at ¶¶ 10-11); and (ii) in any event, this defense was waived under CPLR 3211 (e) (see id. at ¶¶ 12-17). But these arguments would hold true only if defendants' personal-jurisdiction defense necessarily rests on a challenge to the validity of service. And it does not. (See CPLR 3211 [e] [distinguishing for waiver purposes between an "objection based upon a ground specified in paragraph eight or nine of subdivision (a) of this rule" and "an objection that the summons and complaint . . . was not properly served," in particular].)

Even assuming that service on defendants is proper, this court still must have statutory authority to exercise jurisdiction over them. (See Paterno v Laser Spine Inst., 24 NY3d 370, 375-376 [2014] [affirming dismissal of action for lack of personal jurisdiction].) Pirs Capital has not established that the necessary authority exists here. According to the allegations of the complaint, merchant is a Tennessee limited-liability company with a principal place of business in Texas. (NYSCEF No. 1 at ¶ 2.) Guarantor is a Texas domiciliary. (Id. at ¶ 4.) CPLR 302 permits this court to exercise jurisdiction over these defendants, therefore, only if they come within one of the four categories itemized in CPLR 302 (a). Neither the allegations of the complaint, nor plaintiff's motion papers, allege facts that would bring defendants within one of those categories. Nor do defendants consent in the agreement to the action's being brought in the New York courts, which will give rise to personal jurisdiction under CPLR 301 even when long-arm jurisdiction under CPLR 302 does not exist.[FN2] (See Pichardo v. Zayas, 122 AD3d 699, 702 [2d Dept 2014].) Pirs Capital thus fails to show, prima facie, that defendants' personal-jurisdiction defense is inapplicable.

Given this court's conclusion that plaintiff has failed to satisfy its initial prima-facie burden, the court resolves the motion without reaching defendants' arguments raised in opposition to summary judgment.

Accordingly, it is

ORDERED that Pirs Capital's motion for summary judgment is denied.

DATE 7/7/2023 Footnotes

Footnote 1:The guarantee incorporates by reference the terms of the underlying agreement. (See NYSCEF No. 16 at 12.)

Footnote 2:This action thus differs from Pirs Capital, LLC v D&M Truck, Tire & Trailer Repair Inc. (69 Misc 3d 457 [Sup Ct, NY County 2020]). In that case, unlike this one, the out-of-state defendants consented in the underlying agreement to the jurisdiction of the New York courts, should Pirs Capital elect to sue here (as it ultimately did). (See Index No. 651203/2019, NYSCEF No. 9 at 6 § 4.5.)