| Able Energy, Inc. v Marcum & Kliegman LLP |
| 2010 NY Slip Op 00196 [69 AD3d 443] |
| January 12, 2010 |
| Appellate Division, First Department |
| Able Energy, Inc., et al.,Appellants-Respondents, v Marcum & Kliegman LLP et al.,Respondents-Appellants. |
—[*1] L'Abbate, Balkan, Colavita & Contini, L.L.P., Garden City (Scott E. Kossove of counsel),for respondents-appellants.
Order, Supreme Court, New York County (Richard B. Lowe, III, J.), entered May 13, 2008,which granted defendants' motion to the extent of dismissing the third, fourth, fifth and sixthcauses of action against all defendants and the seventh and eighth causes of action against theindividual defendants, unanimously modified, on the law, to the extent that the seventh andeighth causes of action are dismissed in their entirety, and otherwise affirmed without costs.Order, same court and Justice, entered June 19, 2009, which held that the 2008 order did notlimit the amount of damages recoverable on the first and second causes of action, and thatplaintiffs were entitled to discovery related thereto, unanimously affirmed, without costs.
The causes of action alleging breach of the covenant of good faith and fair dealing againstthe accounting firm of Marcum & Kliegman, and negligence and gross negligence against thefirm and its individual accountants, were properly dismissed for failure to allege actualascertainable damages arising in connection with such claims, which were nonduplicative of thedamages asserted in connection with its breach of contract claims (see Pellegrino v File,291 AD2d 60, 63 [2002], lv denied 98 NY2d 606 [2002]; see also Gordon v Dino DeLaurentiis Corp., 141 AD2d 435, 436 [1988]). The claim for breach of fiduciary duty,against all defendants, was properly dismissed since the duty owed by an accountant to a client isgenerally not fiduciary in nature (see DG Liquidation v Anchin, Block & Anchin, 300AD2d 70 [2002]), and plaintiffs did not plead any of the limited circumstances in which such aduty may arise.
The defamation claims against all defendants, predicated on information contained in anAugust 24, 2007 letter to the Securities and Exchange Commission (SEC), were properlydismissed as to the individually named defendants, given the evidence that the letter was signedsolely in the firm's capacity as a limited liability partnership. However, the firm's argument fordismissal of the defamation claims against the firm itself based on an "absolute privilege"defense is sufficiently supported, and those claims should also have been dismissed. The letter ofAugust 24, 2007 to the SEC's finance division potentially could be used by the SEC in aquasi-judicial proceeding. It is irrelevant whether or not the SEC actually commenced such aproceeding (Rosenberg v MetLife,[*2]Inc., 8 NY3d 359, 367-368 [2007]). Thus, thestatements made in the August 24, 2007 letter are protected by an absolute privilege.
Contrary to the firm's argument, we find no basis for limiting the alleged contract damages toclaims of overcharge at this pre-answer, prediscovery juncture. Concur—Mazzarelli, J.P.,Sweeny, Catterson, Freedman and RomÁn, JJ. [Prior Case History: 2008 NY Slip Op31363(U).]