New York Court of Appeals Victory for Capital One N.A.
Won an important victory before the New York Court of Appeals on behalf of a major national bank regarding the shortening of the limitations period contained in New York’s UCC 4-406 which governs a bank customer's duty to discover and report unauthorized signatures or alterations. In a significant decision for the banking industry, the Court of Appeals held that two financially sophisticated parties can modify UCC 4-406’s statutory one-year period for reporting unauthorized activity to 14 days, the time frame provided for in the bank documents between the parties. Herrick represented Capital One through every stage of the dispute, obtaining dismissal of the customer’s complaint at the trial court which awarded summary judgment to Capital One on all of its counterclaims.
Pharmaceutical Company – Consumer Fraud Class Action Dismissed with Prejudice
Achieved a significant victory in New Jersey federal court on behalf of a pharmaceutical company, securing the dismissal of our client from a putative class action alleging violations of consumer fraud laws in the marketing of product. Finding that the plaintiffs had failed to remedy basic pleading deficiencies in their original complaint, dismissed for lack of jurisdiction and failure to state a claim, the court dismissed the amended complaint with prejudice since “further amendment would be futile.”
Commercial Bank – All Claims Dismissed in Litigation over Failed Loan
Negotiated a settlement on behalf of a commercial bank resulting in the voluntary dismissal of all claims filed in a New Jersey state court by an asset manager seeking to hold the bank responsible for losses on a failed loan made to a furniture business prior to the business’ bankruptcy filing. Claiming that it had been induced into extending the loan based, in part, on a multi- million revolving credit line extended to the business by our client, the plaintiff argued that the credit line and our client’s alleged failure to adequately monitor the business gave the plaintiff the impression that the business was is better financial shape than it was. Following Herrick’s filing of a third-party complaint, repeated motions to dismiss and an aggressive discovery, the plaintiff dismissed its claims against our client without any payment or admission of wrongdoing while negotiating settlements from the remaining defendants.
Google Inc. – NJ Appellate Division Affirms Summary Judgment
Represented Google Inc. before the NJ Appellate Division, which affirmed summary judgment granted by the New Jersey Superior Court in favor of Google, dismissing claims by an online merchant for breach of contract and the covenant of good faith and fair dealing. The appellate court upheld the terms and enforceability of Google’s online merchant "click-wrap" agreement, including its liability limitations, while rejecting plaintiff’s claim that it was an unenforceable contract of adhesion. D’Agostino v. Appliances by Phone, Inc., et al., 2016 N.J. Super. Unpub. LEXIS 504 (Mar. 8, 2016).
Ireland-based Technology Company – Advisory Firm’s Breach of Contract Claims Dismissed
Secured the dismissal of all claims against an Ireland-based software company and its US subsidiary filed in New York state court by an advisory firm alleging our client had breached the terms of a service agreement in which the plaintiff was to either find a buyer for the company or find entities willing to provide financing. Asserting breach of contract, fraudulent inducement and unjust enrichment, among other causes of action, the plaintiff further alleged that the agreement was breached just prior to a transaction which would have entitled the plaintiff to a significant fee. In its order, the court agreed that the plaintiff had failed to establish jurisdiction over the Ireland-based parent and that the U.S.-based entity was never a party to the agreement at issue.
Appellate Court Victory Barring Arbitrator from Modifying Original Award
Herrick secured an important victory before the Appellate Division, Second Department, obtaining a ruling affirming the trial court’s decision to overturn a Bet Din arbitration in which the arbitrator issued an additional award against our client after having already rendered a final award. The plaintiff had argued that the arbitrator’s first award of $425,000 was only an interim judgment and that the agreement vested the arbitrator with continuing authority to issue another award against our client, two years later and involving the same general subject matter, for an additional $3.75 million. Although courts rarely overturn arbitration awards, the appellate court agreed that the arbitrator lacked the authority to expand the previous award and affirmed the decision on the grounds that the arbitrator was "Functus Officio."
Multinational Food & Beverage Company – Successful Defense in New Jersey Franchise Practices Litigation
Successfully defended the U.S. affiliate of a multinational food & beverage company sued in New Jersey federal court by a distributor alleging violation of the state's Franchise Practices Act. In both the district court and on appeal to the Third Circuit, Herrick delivered key victories in opposing the plaintiff's efforts to secure an injunction preventing our client from effecting its contractual right not to renew an exclusive distribution agreement between the parties. In the district court, we obtained rulings partially dismissing the complaint, denying plaintiff's motion for a preliminary injunction, and denying plaintiff's motion for an injunction pending its appeal to the U.S. Court of Appeals for the Third Circuit. Following expedited briefing, the appellate court found in our client's favor, affirming the district court's rulings. In light of these developments, the parties ultimately reached a settlement and stipulated to the dismissal of this litigation.
Counsel and Law Firm – Successful Appeal of Contempt of Court Ruling
Secured a favorable ruling from the Second Circuit on behalf of attorneys and their law firm in their appeal of a district court’s ruling holding them in contempt of court and sanctioning them for the alleged failure of their clients, the Republic of Iraq and Iraq's Ministry of Industry, to comply with a post-judgment discovery order. Finding that our clients had been given insufficient notice of the charges, and that the district court exceeded the bounds of its discretion when, under the circumstances, it proceeded to sua sponte find the attorney appellants in contempt, the Second Circuit vacated the order of contempt against our clients. In vacating the contempt finding, the Second Circuit also ruled that the attorneys had appellate jurisdiction even after the underlying case against their clients had settled and the judgment satisfied, a previously open question of law in this Circuit.
Major League Baseball Franchise – Contract Dispute
Obtained summary judgment, including dismissal of all claims and recovery on counterclaim for breach of contract, on the district court level on behalf a Major League Baseball franchise in a contract dispute involving advertising and sponsorship rights, and protected judgment on appeal to the Second Circuit.
Real Estate Developers – Summary Judgment in Litigation over Recourse Provision in Mezzanine Loan Guaranty
Defense of the guarantors of a multimillion dollar mezzanine loan secured for the development of several Florida condominium projects in an action filed by the lender in New York federal court. Seeking the full outstanding balance of the loan with interest, an amount totaling nearly $190 million, the lender claimed that certain transfers out of an escrow account holding condominium purchasers’ deposits triggered a full recourse provision in the guaranty. Herrick successfully argued that the full recourse provision of the guaranty was never triggered, obtaining a ruling granting our motion for summary judgment and dismissing all claims against our clients.
Ukrainian Technology Services Company – Breached Master Service Agreement
Herrick secured an extremely favorable settlement on behalf of a Ukraine-based technology service provider, resolving its claims against a US-based multinational financial services company in connection with more than $6 million in software development services rendered by our client. Significantly, this settlement was accomplished without engaging in potentially extensive and costly litigation.
Appellate Victory Dismissing Former Employer’s Claims against Asset Management Executive
Herrick secured a complete appellate victory in its defense of a hedge fund industry veteran against claims asserted by an asset management firm, where the client had formerly been employed as joint CEO. In its ruling, the Appellate Division, First Department unanimously reversed, with costs, the trial court’s order denying our motion to dismiss the complaint. In its opinion, the appellate court agreed that the plaintiff’s breach of contract, promissory estoppel and unjust enrichment claims, arising from an alleged oral agreement, were time-barred.
Multiple Claims Dismissed in Shareholder Derivative Litigation
Secured a ruling in Kings County Supreme Court on behalf of a garment manufacturer and certain affiliated individuals and entities that dismissed several causes of action in a purported shareholder derivative suit. Among the claims asserted was the allegation that a competing entity had been used by certain defendants to usurp business opportunities, and that ownership of a company facility had been fraudulently transferred to a charitable trust and foundation. The court granted our motion to dismiss the claim for a constructive trust over either the alleged competing entity or the foundation; an unjust enrichment claim against the charitable trust and foundation defendants; and a claim of rescission of the alleged fraudulent transfer of the facility, which the court found was time-barred.
Taxi Medallion Financing Company – $27.5 Million Judgment
Represented a large specialty financing company in enforcing a series of agreements that provided the company with an interest in the appreciation of the underlying collateral. Following extensive briefing on a summary judgment motion, the court rejected defenses based on usury and the Small Business Investment Act and issued a $27.5 million judgment in favor of our client.
All Claims Voluntarily Dismissed Following Award of Sanctions in Real Estate Dispute
Successful defense of an LLC in litigation over the breach of an alleged joint venture agreement which plaintiffs claimed entitled them to an ownership interest in a valuable Manhattan property. Herrick obtained an order canceling plaintiffs’ notice of pendency on the property, and successfully argued for sanctions based on frivolous litigation conduct. In addition to negotiating a substantial monetary settlement for attorneys’ fees and for costs associated with delays in refinancing a $32 million mortgage on the property, Herrick secured the voluntary dismissal of our client from the action and the plaintiffs’ unconditional and irrevocable release of any and all claims to ownership of the property.
Multinational Cosmetics Company – Favorable Resolution to Breach of Contract Action
Represented a multinational cosmetics company in litigation filed in New York federal court by a Washington, DC area retailer asserting breach of contract, detrimental reliance, and tortuous interference claims, which sought monetary damages and a preliminary injunction preventing our client from violating a retailer agreement that allegedly required it to supply cosmetic products to the plaintiff. After obtaining an order denying the plaintiff’s motion for a preliminary injunction, Herrick negotiated a settlement on favorable terms that resolved the litigation.
All Claims Dismissed in Litigation Challenging $9 Million Sale of Brooklyn Apartment Building
Secured a ruling dismissing all claims against the insured buyers of a Brooklyn apartment building in litigation seeking to strip them of their interests in the property. The plaintiff launched a multi-pronged attack on the $9 million sale of the building, claiming the transaction had violated his right of first refusal, that the individual who had signed the deed transferring title to the property lacked capacity, and that the deed itself was a forgery. In its ruling, a New York state court granted our motion to dismiss in its entirety and cancelled the notice of pendency.
DataTreasury Corp. – $100 Million Dispute with Former COO
Successful defense of DataTreasury Corp. in a 41-day bench trial arising from claims by the company's former Chief Operating Officer that he was entitled to exercise certain stock options granted to him during his tenure. We helped obtain a decision dismissing all of the former executive's claims, based on his disloyal conduct in trying to usurp business opportunities coupled with his failure to properly exercise the options, defeated the plaintiff's multiple post-trial motions, and successfully defended those decisions before the New York State Appellate Division, Second Department which unanimously affirmed.
Outdoor Advertising Company – Preliminary Injunction Secured in Dispute over Times Square Billboard Lease
Represented a major outdoor advertising billboard company in seeking a permanent injunction to prevent the termination of a valuable lease for an iconic LED billboard space in the heart of Times Square. Following the landlord’s refusal to honor our client’s right to exercise a 10-year renewal option in the lease, Herrick secured a temporary restraining order preventing the defendants from taking steps to terminate or otherwise interfere with our client’s possession of the space. When negotiations failed to resolve the differences between the parties, Herrick successfully argued for a preliminary injunction pending a determination on the merits. In the wake of these successes, and on the eve of arguments on our motion for summary judgment, Herrick was able to negotiate a very favorable settlement that allowed our client to renew the lease and maintain its possession of the billboard space.
Affordable Housing Developer – Resolution of Breach of Contract Claims against NYCHA
Negotiated a favorable settlement on behalf of a national developer of affordable housing, resolving a breach of contract litigation against the New York City Housing Authority related to a high-profile and long-stalled project to redevelop a large New York City public housing complex.
Appellate Division Reverses Civil Penalty against Landlord over ADA Accommodations
Herrick achieved a significant appellate victory on behalf of a national real estate development and management firm, securing a ruling from the Appellate Division, Second Department that reversed a New York City Commission on Human Rights order requiring the client to pay a $185,000 fine for denying a tenant's request to construct a handicapped-accessible entrance to her Queens apartment. In its ruling, the court wrote that the record lacked "substantial evidence" to contradict our client’s claim that installing an accessible entrance was not structurally feasible. The decision was the culmination of a nearly 6-year-long dispute in which we initially prevailed on the client’s behalf before an administrative law judge who held that the proposed accommodation sought by the tenant was not reasonable. The Commission, however, summarily rejected the ruling, and awarded $200,000 in damages and penalties. A Queens Supreme Court affirmed the agency’s decision but reduced the award of damages. On appeal, and after oral argument, the Second Department reversed the trial court’s decision, holding that the Commission’s determination of unlawful discrimination and award of damages should have been annulled in its entirety.
Successful Challenge to Arbitration Award in $42 Million Dispute
Herrick successfully argued for the overturning of an arbitration award in a $42 million dispute over the proper distribution of an estate - an especially notable win for our client as arbitration awards are so difficult to vacate. Based on the arbitrator's violation of a little-known New York state law that invalidates arbitration proceedings held on a Sunday, the court ruled that the arbitration proceedings and award were void, and also found that the arbitrator had exceeded the scope of its power when it imposed a legal fee penalizing any party challenging the award when the parties had never agreed to such a provision. Additionally, the court found that the award involved distribution of estate assets which can only be distributed by the Surrogate's Court.
Major League Sports Team – Dismissal of False Advertising Class Action
Successful defense of a major league professional sports team, obtaining pre-motion dismissal of all claims in a high-profile putative class action alleging deceptive trade practices and false advertising in connection with a very large sale of memorabilia.
Real Estate Management Company – Precedent Setting Decision in Wage & Hour Action
Successful defense of a real estate management company and its principal sued by a former residential janitor and two alleged former laborers at New York City properties managed by our client. The plaintiffs claimed minimum wage and overtime violations under the Fair Labor Standards Act and New York Labor Law, as well as related common law claims. The court granted, in substantial part, our motion to dismiss, striking 9 of the plaintiffs’ 12 claims in one of the first decisions to interpret the minimum wage and overtime provisions under New York law and the Minimum Wage Order for the Building Service Industry as they relate to residential janitors.
Real Estate Brokerage Firm – Dismissal of Discrimination Claims Upheld on Appeal
Successful defense of a luxury real estate brokerage firm in an action alleging discrimination based on sexual orientation and marital status in violation of New York State and City Human Rights Laws. Herrick secured the complete dismissal of the complaint in the trial court, and then successfully defended the ruling on plaintiffs’ appeal to the Appellate Division, First Department which upheld the dismissal, finding the plaintiffs had no cognizable claims against our clients who had sought to facilitate, not prevent, plaintiffs’ purchase of a cooperative apartment.
Investment Fund – Breach of Participation Agreement Dispute
Herrick negotiated a very favorable settlement on behalf of an alternative investment fund in a breach of contract suit arising from a transaction in which our client acquired a 10 percent participation in a loan to a mining company. We sued in New York state court after realizing that a significant portion of the collateral securing the loan had been disposed of without our client receiving its pro rata share of the proceeds as required under the participation agreement. Herrick was able to negotiate a substantial settlement for the client that avoided the need for protracted litigation.
Apparel Manufacturer – Successful Defense in Breach of Contract and Unpaid Compensation Action
Successful defense of a leading manufacturer of coats and outerwear in a dispute related to the acquisition of the assets of a business, and an employment agreement between our client and the business's former owner. The court dismissed plaintiffs' complaint, which asserted claims for breach of the asset purchase agreement and employment agreement, and granted our client's counterclaims for breach of those same agreements. Following the trial court's determination of liability in our client's favor, we reached a favorable settlement regarding damages to our client.
Borrower – Negotiated Settlement to Resolve Dispute with Guarantor
Negotiated a favorable settlement on behalf of a borrower to resolve litigation initiated by a guarantor seeking to recover damages arising from our client’s alleged default on loans totaling over $7 million.
Manufacturer – All Claims Dismissed in JAMS Arbitration Initiated by Former CEO
Achieved total victory for a promotional products manufacturer and distributor, defeating all claims asserted in an arbitration for breach of employment and shareholders agreements, breach of fiduciary duty, and shareholder oppression initiated by the company’s former CEO and former majority shareholder. The panel found that the claimant had indeed been properly terminated, referencing numerous instances in which the claimant charged the client for non-business related expenses or used company resources to conduct side businesses for the sole benefit of the claimant’s friends and relatives. Finding the remaining claims meritless, the panel ultimately found our client, as the prevailing party, entitled to recover the full costs of the arbitration, including legal fees.
Challenge to New York State’s Charter School Funding Law
Represented the plaintiffs in Brown v. New York, and initially secured a winning ruling in New York State Supreme Court denying a motion to dismiss our lawsuit challenging New York State's method of funding public charter schools. Our clients, five “representative” families whose children attend charter schools in the state and a Charter School advocacy organization for its member New York charter schools (Northeast Charter Schools Network), argued that New York's practice of providing charter students with as little as three-fifths of what district students receive in the same community, violates the state Constitution and disproportionately affects children of color and lower incomes. While we ultimately lost on appeal, the ruling was particularly important as similar claims raised by charter school parents in four others states – North Carolina, New Jersey, Arizona and Texas – all failed to survive lower court defense motions to dismiss.
Business Dispute – Proposed Solar Farm Joint Venture
Successfully defended a New Jersey-based real estate company in litigation filed in New York state court by a potential joint venture partner in the development of New Jersey solar farm installations. When the venture never materialized, the plaintiff filed suit asserting breach of contract and tort claims, and seeking over $10 million in damages. Herrick obtained a dismissal of all claims against the client in the trial court, and won affirmation of the dismissal from the Appellate Division, First Department.
Aviation Services Company – Breach of Contract and Unjust Enrichment Claims
Negotiated a favorable settlement on behalf of an aviation services company to resolve breach of contract and unjust enrichment claims filed in New York federal court in connection with a business venture to purchase and modify a large commercial aircraft for a planned sale to a third-party for use as an executive business jet.
Lelands – Jim Brown’s NFL Championship Ring
Represented Lelands in litigation filed in New York federal court by former National Football League player Jim Brown regarding the recovery of a 1964 NFL championship ring alleged to have been stolen.
Manufacturer – Summary Judgment in Breach of Contract Action
Successfully represented a Queens, NY-based packaging manufacturer, obtaining summary judgment in a New York state court breach of contract action against a former customer who failed to pay for goods ordered and received.
International Diamond Grading Network – All Claims Dismissed in Trademark/Unfair Competition Dispute
Following a 7-day trial in New York federal court, Herrick obtained a ruling dismissing all claims against our clients, an international diamond grading network and related individuals, in a hotly-contested trademark and unfair competition dispute in which the opposing party sought damages totaling nearly $140 million, as well as draconian and sweeping permanent injunctive relief, under the Lanham Act. Herrick delivered a ruling to our clients that removed the threat of a devastating damages award and judicial injunction, as well as any liability for the opposing party's attorneys' fees.
Global Automotive Manufacturer – Dismissal of All Claims in Product Liability Litigation
Herrick successfully defended the North American operations of a global automotive manufacturing company in product liability litigation involving claims based upon implied and express warranties, strict liability and negligence, all premised upon alleged property damage to a vehicle and consequential damages to a construction business caused by allegedly defective tires. The court dismissed all claims against our client, finding that the causes of action were barred under the economic loss doctrine.
New York Attorney – Successful Defense of Malpractice Claims
Successful defense of a prominent New York City attorney against malpractice claims related to the plaintiff's participation in a written agreement to provide for the funding of loans in the New York City taxicab industry. This dispute had progressed to a jury trial when the parties entered into a settlement in which the plaintiff voluntarily dismissed the action and agreed to pay all trial costs.
$25 Million Jury Award – Retrial of Guaranty Case
Won a $25 million jury award in the retrial of a claim originally dismissed by the district court after trial but prior to going to the jury, then reinstated on appeal. The client, an entrepreneur and investor, brought in Herrick to retry the issue of whether the defendant's guaranties on loans made to certain fraudulent and judgment proof entities were enforceable. The jury agreed with our position that the guaranties were enforceable and awarded our client $25 million in damages.
Title Insurance Company – Class Action Defense
Representation of a title insurance company in a class action alleging overcharges on premiums for policies sold to consumers in New Jersey. We settled—on terms favorable to our client—early enough in negotiations to minimize our client's legal fees.
Trucking Company – Contract Termination/TRO
Representation of Trucking Company in contract termination litigation in U.S. District Court with contract partner/wholesaler attempting to terminate for breach of contract. After hearing, obtained a preliminary injunction preventing termination.
Construction Management Company – Wrongful Termination
Representation of a construction management company in a dispute with NYU Hospitals Center regarding the termination of a multi-million dollar renovation contract. After a trial in Federal Bankruptcy Court, the court held in favor of our client on all counts, entitling them to payment of its outstanding requisitions and dismissal of all claims against them.
Investment Banker – Business Divorce
Representation of a partner in negotiating and implementing his separation from a boutique investment bank.
Distressed Debt Investor – Mezzanine Loan Foreclosure
Representation of a distressed debt investor in foreclosing and conducting UCC secured party sale of portfolio of mezzanine loans securing repo line of credit obligations. One of the mezzanine loan borrowers sought to enjoin the sale; we defeated the TRO application and conducted the sale successfully over the borrower's objection.
International Insurance Company – Breach of Contract
Representation of major international insurance company in breach of contract dispute.
Title Insurance Companies – Class Action Defense
Representation of two title insurance companies in two class actions alleging overcharges on premiums for policies sold to consumers in New York. After extensive litigation, we settled on terms favorable to our clients.
Large Asset Manager – Discrimination Case
Representation of a large asset manager in a national origin case based on disability and religion.
Multinational Tire Manufacturer – Consumer Fraud Class Action Defense
Successful defense of the North American subsidiary of a multinational automotive parts manufacturer in national consumer fraud class actions involving allegations that an innovative tire design was more susceptible to road hazard damage than regular tires. The firm’s successes on behalf of the client include obtaining an important, precedent setting decision from the Third Circuit Court of Appeals that vacated the lower court’s certification of a limited New Jersey sub-class of plaintiffs, and then later securing the dismissal of all but one of the claims asserted in a copycat class action, effectively precluding the plaintiffs from further pursuing the litigation.
Product Manufacturer – Class Action
Represented a product manufacturer in federal class action involving claims of consumer fraud and product liability.
National Black Theatre – Real Estate Litigation Victory
Representation of the National Black Theatre in winning summary judgment against its partner Nubian properties in a real estate breach-of-contract suit involving National Black Theatre's landmark headquarters at the corner of 125th Street and 5th Avenue in Harlem, also known as "National Black Theatre Way."
JP Morgan Chase – Fraud Litigation Victory
Represented JP Morgan Chase in a suit brought by a borrower's principal and guarantors alleging that our client had impermissibly drawn down on a letter of credit provided as a security for a loan on a piece of property in Harlem. Herrick won summary judgment and the borrower appealed. The First Department affirmed the lower court's dismissal of the complaint. The decision clears the way for the ultimate foreclosure of the property.