| Thyroff v Nationwide Mut. Ins. Co. |
| 2008 NY Slip Op 10311 [57 AD3d 1433] |
| December 31, 2008 |
| Appellate Division, Fourth Department |
| Louis E. Thyroff et al., Respondents, v Nationwide Mutual InsuranceCompany et al., Appellants. |
—[*1] William P. Tedards, Jr., Washington, D.C., of the Washington, D.C. bar, admitted pro hac vice,and Brown & Tarantino, LLC, Rochester, for plaintiffs-respondents.
Appeal from an order of the Supreme Court, Monroe County (Evelyn Frazee, J.), enteredDecember 18, 2007. The order denied the motion of defendants for summary judgment.
It is hereby ordered that the order so appealed from is unanimously reversed on the law withoutcosts, the motion is granted and the amended complaint is dismissed.
Memorandum: Plaintiffs commenced this action (second action) in Supreme Court for conspiracyand malicious prosecution relating to a counterclaim asserted by defendant Nationwide MutualInsurance Company (Nationwide) in an action previously commenced by plaintiffs in federal court (firstaction) after Nationwide terminated its employment agreement with plaintiff Louis E. Thyroff (plaintiffhusband). The course of the litigation in the first action is set forth in the decision of the Second CircuitCourt of Appeals (Thyroff v Nationwide Mut. Ins. Co., 493 F3d 109 [2007]), and is notrelevant herein. The second action was transferred to federal court on defendants' motion, whereuponplaintiffs filed an amended complaint and moved to remit the second action back to Supreme Court.Defendants opposed the motion and moved to dismiss the amended complaint. The federal courtgranted plaintiffs' motion to remit and consequently denied defendants' motion to dismiss as moot.
We conclude that Supreme Court, upon remittal, erred in denying defendants' motion for summaryjudgment dismissing the amended complaint in the second action. We conclude at the outset that,contrary to the court's determination, denial of the motion is not required based on the doctrine ofcollateral estoppel. As noted, the federal court denied defendants' motion to dismiss the amendedcomplaint in the second action on the ground that it was rendered moot based on the remittal of theaction to Supreme Court. Thus, the issue whether dismissal was warranted was never " 'actuallylitigated, squarely addressed [or] specifically decided' " (Zayatz v Collins, 48 AD3d 1287, 1290 [2008], [*2]quoting Ross v Medical Liab. Mut. Ins. Co., 75 NY2d 825, 826[1990]; see B.F. Yenny Constr. Co., Inc. vOne Beacon Ins. Group, 50 AD3d 1477, 1479 [2008]).
We further conclude that defendants established their entitlement to judgment as a matter of lawwith respect to the merits of their motion in Supreme Court in the second action. According to plaintiffs,Nationwide entered into a conspiracy with the remaining three defendants, each of whom was aninsurance agent under contract with Nationwide. Pursuant to that alleged conspiracy, Nationwidepromised those defendants, at no cost to them, a portion of the business of plaintiff husband, who wasalso an insurance agent under contract with Nationwide. Plaintiff husband then commenced the firstaction in federal court, and defendants asserted a compulsory counterclaim against him (seegenerally Baker v Gold Seal Liquors, Inc., 417 US 467, 469 n 1 [1974]; Nasalok CoatingCorp. v Nylok Corp., 522 F3d 1320, 1324-1325 [2008]). In that counterclaim, Nationwidealleged that plaintiff husband was directly and indirectly inducing Nationwide's policyholders to allowtheir policies to lapse or to cancel them and that Nationwide in fact terminated his employment basedon his violation of the regulations of the Securities and Exchange Commission. In addition, Nationwidealleged that plaintiff husband was violating the noncompete clause of his agreement with Nationwide.Plaintiffs now allege in the second action that the counterclaim was filed and pursued "without probablecause and with malice." "To prove malicious prosecution based upon a prior civil action, a plaintiff mustshow that a prior proceeding terminated in [his or her] favor, a patent lack of probable cause for thatproceeding, malice and special damages" (Rossi v Attanasio, 48 AD3d 1025, 1028-1029 [2008]; see Purdue Frederick Co. v Steadfast Ins.Co., 40 AD3d 285, 286 [2007]; Black v Green Harbour Homeowners' Assn., Inc., 37 AD3d 1013,1014 [2007]). Here, even assuming, arguendo, that Nationwide's compulsory counterclaim in the firstaction in federal court constituted the commencement of an action, we conclude that defendants mettheir initial burden on their motion in the second action in Supreme Court, and plaintiffs failed to raise anissue of fact (see generally Zuckerman v City of New York, 49 NY2d 557, 562 [1980]). Withrespect to the cause of action for malicious prosecution, defendants presented evidence establishing thatNationwide had independent information that plaintiff husband was violating the noncompete clause ofthe agreement, and thus it cannot be said that the counterclaim was asserted with "a patent lack ofprobable cause . . . [and] malice" (Rossi, 48 AD3d at 1028-1029; seegenerally Nardelli v Stamberg, 44 NY2d 500, 502 [1978]). Defendants thus are also entitled tosummary judgment dismissing the cause of action for conspiracy, inasmuch as "New York does notrecognize civil conspiracy to commit a tort as an independent cause of action" (Sokol vAddison, 293 AD2d 600, 601 [2002]; see Romano v Romano, 2 AD3d 430, 432 [2003]).Present—Scudder, P.J., Hurlbutt, Peradotto, Green and Gorski, JJ.