| Segal v Cooper |
| 2008 NY Slip Op 02758 [49 AD3d 467] |
| March 27, 2008 |
| Appellate Division, First Department |
| Josh Segal, Individually and Derivatively on Behalf of LighthouseReal Estate Advisors, L.L.C., Respondent, v Paul Cooper et al.,Appellants. |
—[*1] Michael T. Sucher, Brooklyn, for respondent.
Order, Supreme Court, New York County (Milton A. Tingling, J.), entered November 23,2007, which denied defendants' motion to dismiss the amended complaint, unanimouslymodified, on the law, to strike plaintiff's demands for punitive damages, and otherwise affirmed,without costs.
Accepting as true the facts as alleged in the complaint, according plaintiff the benefit ofevery favorable inference, and determining only whether the facts as alleged fit within anycognizable legal theory (Sokoloff v Harriman Estates Dev. Corp., 96 NY2d 409, 414[2001]), we find that plaintiff's causes of action were adequately alleged. As to fraud, whetherplaintiff's reliance upon defendants' alleged misrepresentations was reasonable is a factual issuenot to be resolved on a motion directed at the pleadings (see generally Brunetti v Musallam, 11 AD3d 280 [2004]). Theadequacy of the breach of contract cause of action is gleaned from the complaint as a whole(see Dulberg v Mock, 1 NY2d 54, 56 [1956]). Plaintiff's allegations that, on behalf of thebusiness venture he entered into with the individual defendants to market certain properties, heactively marketed the properties, and commissions were generated and paid to defendants, whoultimately diverted them, depriving him of his share of the commissions, adequately state a causeof action for unjust enrichment (see Wiener v Lazard Freres & Co., 241 AD2d 114,119-121 [1998]). Moreover, contrary to defendants' contention, that cause of action need not bedismissed merely because it "contradicts the underlying theory" of the breach of contract cause ofaction (see Cohn v Lionel Corp., 21 NY2d 559, 563 [1968]; Limited v McCroryCorp., 169 AD2d 605, 607 [1991]; CPLR 3014). As to the unjust enrichment cause of actionasserted derivatively, plaintiff alleged with sufficient particularity that a majority of thecontrolling members of the limited liability company were interested in the challengedtransactions and that therefore a demand to initiate a lawsuit would have been futile (seeMarx v Akers, 88 NY2d 189, 198 [1986]).
Plaintiff's demand for punitive damages should have been struck since his primary claim iscontract-based and there is no allegation that defendants' conduct was directed at the publicgenerally (see Giblin v Murphy, 73 NY2d 769 [1988]). Nor do the allegations indicatethat [*2]defendants' conduct in the transactions involved a highdegree of moral turpitude (see Gamiel vCurtis & Riess-Curtis, P.C., 16 AD3d 140 [2005]).
We have reviewed defendants' remaining arguments and find them without merit.Concur—Mazzarelli, J.P., Saxe, Buckley and Catterson, JJ.