Brainstorms Internet Marketing, Inc. v. USA Networks, Inc.

Appellate Division of the Supreme Court of New York

Brainstorms Internet Marketing, Inc. v. USA Networks, Inc.

6 A.D.3d 318, 775 N.Y.S.2d 844, 2004 N.Y. App. Div. LEXIS 4885

Appellate Division of the Supreme Court of the State of New York·Decided April 27, 2004·Published·Cited by 11 cases

Opinion

Order, Supreme Court, New York County (Charles E. Ramos, J.), entered November 21, 2002, which granted defendants’ motion to dismiss the action pursuant to CPLR 3211 (a) (7), unanimously modified, on the law, to deny defendants’ motion with respect to plaintiffs’ claim for breach of contract against defendant USA Networks Interactive LLC (USANI) and to reinstate that claim, and otherwise affirmed, without costs.

The complaint adequately alleges that defendant USANI, by sending an e-mail to plaintiffs setting a closing date for its purchase of the remaining 84% of plaintiffs’ business, did, in fact, exercise the purchase option accorded it in the parties’ June 23, 2000 purchase agreement pursuant to the agreement’s terms (see Kaplan v Lippman, 75 NY2d 320 [1990]), and the evidentiary material submitted by USANI on the motion did not conclusively establish the contrary (see Leon v Martinez, 84 NY2d 83, 87-88 [1994]). The contract claims were, however, properly dismissed as to the remaining defendants, which were not signatories to the purchase agreement. Plaintiffs’ conclusory allegations that USANI was the alter ego of the nonsignatory defendants were insufficient to sustain the action as against the nonsignatories, particularly since they were unaccompanied by allegations supporting the inference that USANI was utilized by the nonsignatories for fraud, malfeasance or other inequity (see TNS Holdings v MKI Sec. Corp., 92 NY2d 335 [1998]; DC A Adv. v Fox Group, 2 AD3d 173 [2003]). Since the contractual re[319]*319lationship between the parties did not give rise to a fiduciary relationship, the cause of action asserting a breach of fiduciary duty was properly dismissed.

We have considered plaintiffs’ remaining arguments and find them unavailing. Concur—Buckley, P.J., Mazzarelli, Saxe and Sullivan, JJ.

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Order, Supreme Court, New York County (Charles E. Ramos, J.), entered November 21, 2002, which granted defendants’ motion to dismiss the action pursuant to CPLR 3211 (a) (7), unanimously modified, on the law, to deny defendants’ motion with respect to plaintiffs’ claim for breach of contract against defendant USA Networks Interactive LLC (USANI) and to reinstate that claim, and otherwise affirmed, without costs.

The complaint adequately alleges that defendant USANI, by sending an e-mail to plaintiffs setting a closing date for its purchase of the remaining 84% of plaintiffs’ business, did, in fact, exercise the purchase option accorded it in the parties’ June 23, 2000 purchase agreement pursuant to the agreement’s terms (see Kaplan v Lippman, 75 NY2d 320 [1990]), and the evidentiary material submitted by USANI on the motion did not conclusively establish the contrary (see Leon v Martinez, 84 NY2d 83, 87-88 [1994]). The contract claims were, however, properly dismissed as to the remaining defendants, which were not signatories to the purchase agreement. Plaintiffs’ conclusory allegations that USANI was the alter ego of the nonsignatory defendants were insufficient to sustain the action as against the nonsignatories, particularly since they were unaccompanied by allegations supporting the inference that USANI was utilized by the nonsignatories for fraud, malfeasance or other inequity (see TNS Holdings v MKI Sec. Corp., 92 NY2d 335 [1998]; DC A Adv. v Fox Group, 2 AD3d 173 [2003]). Since the contractual re[319]*319lationship between the parties did not give rise to a fiduciary relationship, the cause of action asserting a breach of fiduciary duty was properly dismissed.

We have considered plaintiffs’ remaining arguments and find them unavailing. Concur—Buckley, P.J., Mazzarelli, Saxe and Sullivan, JJ.

Brainstorms Internet Marketing, Inc. v. USA Networks, Inc., 6 A.D.3d 318, 775 N.Y.S.2d 844, 2004 N.Y. App. Div. LEXIS 4885 (N.Y. Ct. App. 2004).

Pincite

6 A.D.3d 318 (Brainstorms Internet Marketing, Inc. v. USA Networks, Inc.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Opinion

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