[*1]
Deep v Boies
2007 NY Slip Op 51532(U) [16 Misc 3d 1121(A)]
Decided on August 9, 2007
Supreme Court, Albany County
Platkin, J.
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This opinion is uncorrected and will not be published in the printed Official Reports.


Decided on August 9, 2007
Supreme Court, Albany County


John A. Deep, Plaintiff,

against

David Boies; Boies Schiller & Flexner, LLP; Straus & Boies, LLP and William Duker, Defendants.




6453-05



APPEARANCES:

James Edward Gross, Esq.

Attorney for Plaintiff

750 Broadway, Suite 3

Albany, NY 12207

Gleason, Dunn, Walsh & O'Shea

Attorneys for Defendants

(Thomas F. Gleason, Esq., of Counsel)

40 Beaver Street

Albany, NY 12207

Richard M. Platkin, J.



This is an action alleging legal malpractice. Defendants David Boies, Boies, Schiller & Flexner, LLP and Straus & Boies, LLP (hereinafter "defendant attorneys") move to renew and reargue their prior motion for summary judgment. Defendants also offer two new grounds for summary judgment. Plaintiff John A. Deep opposes the motion on both substantive and procedural grounds, and also moves for leave to amend his complaint to add a claim of fraud.

Plaintiff's complaint alleges a single claim of legal malpractice, supported by three [*2]theories of liability. The first two theories involve allegations that the defendant attorneys committed legal malpractice in connection with copyright and trademark litigation relating to the Internet file-sharing service known as "Aimster" (and later as "Madster") by failing to disclose a serious conflict of interest and by providing inadequate representation. In a Decision & Order dated December 22, 2006,[FN1] this Court (McCarthy, J.) granted summary judgment to the defendant attorneys on these two theories.

The third theory of malpractice asserted in plaintiff's complaint involves allegations that defendant attorneys' breach of their ethical responsibilities resulted in the misappropriation of plaintiff's interest in the Aimster software assets. The Court determined that disputed issues of fact regarding "who represented Deep, when such alleged representation began and whether the alleged conflicts of interest were properly disclosed" precluded the granting of judgment as a matter of law on this claim.

On this motion, the defendant attorneys move pursuant to CPLR 2221 to renew and reargue the prior motion as it relates to the denial of summary judgment on the misappropriation-based claim of legal malpractice. The prong of defendants' motion seeking renewal is based on the res judicata effect of a decision of the U.S. District Court for the District of Maine issued during the pendency of the prior motion. The motion for renewal is grounded on certain arguments made on the prior motion that allegedly were misapprehended by the Court.

In addition, the defendant attorneys also raise two new arguments for summary judgment: (1) plaintiff's claim is barred by the applicable statute of limitations; and (2) plaintiff's misappropriation-based claim of malpractice is barred by his failure to adequately disclose his interest in such claim and/or the subject assets to Bankruptcy Court in connection with personal bankruptcy filings in 2003 and 2005.

Plaintiff opposes the motion on a variety of grounds. He argues that defendants' res judicata argument was before the Court on the prior motion and, therefore, is not the proper subject of a motion to renew. As to the prong of the motion seeking reargument, plaintiff argues that the Court correctly denied summary judgment.

With respect to the two new grounds for summary judgment raised by the defendant attorneys, plaintiff argues successive summary judgment motions are inappropriate, particularly in the absence of pre-trial discovery. Plaintiff notes that the first motion was filed prior to any discovery, and the instant motion was filed after only a bare minimum of document discovery. Plaintiff also offers arguments on the merits in opposition to defendants' two new arguments for summary judgment.

Plaintiff also moves to amend his complaint pursuant to CPLR 3025 to add a claim of fraud against the defendant attorneys. Defendants oppose the motion, contending that amendment would be futile.

Leave to Reargue

A motion for leave to reargue "shall be based upon matters of fact or law allegedly overlooked or misapprehended by the court in determining the prior motion, but shall not include any matters of fact not offered on the prior motion" (CPLR 2221 [d] [2]). Generally, a motion [*3]for leave to reargue must be made to the judge who signed the order, unless he or she is for any reason unable to hear it (id. [a]). In this case, the prior motion was heard and decided by Justice William E. McCarthy, who subsequently was designated to serve on the Appellate Division, Second Department. Thus, CPLR 2221(a) permits the undersigned to hear reargument of the prior motion.

Nonetheless, the Court believes it would be inappropriate to grant leave to reargue under the circumstances presented by this case. It is well established that a judge generally should refrain from passing on the merits on a matter decided by a judge of equal authority or coordinate jurisdiction. To evaluate defendants' argument that the prior determination "overlooked or misapprehended" certain arguments would necessarily put the Court in the position of sitting in a quasi-appellate capacity, which it declines to do. Insofar as defendants are aggrieved by the prior Decision & Order, their remedy was and is to perfect an appeal to the Appellate Division, Third Department. For this reason, defendants' motion for reargument is denied.

Leave to Renew

A motion for leave to renew "shall be based upon new facts not offered on the prior motion that would change the prior determination or shall demonstrate that there has been a change in the law that would change the prior determination" (CPLR 2221 [e] [2]). Such motion "shall contain reasonable justification for the failure to present such facts on the prior motion") (id. [e] [3]). As with a motion to renew, a motion for leave to reargue must be made to the judge who signed the order, unless he or she is for any reason unable to hear it (id. [a]).

Defendants base their application for leave to renew on a decision of the U.S. District Court for the District of Maine (Deep v. Recording Industry Ass'n of America, Inc. et al., Case Nos. 2:05 cv 118 and 2:05 cv 149 ["Maine Action"]). That decision ("Maine Decision"), which defendants contend is a bar to plaintiff's claim of misappropriation under principles of res judicata, was rendered on October 2, 2006 after defendants had submitted their moving and reply papers on the prior motion. Defendants submitted a copy of the Maine Decision to the Court on October 11, 2006, but it was not referenced in the prior Decision & Order or listed therein as a paper considered.

Plaintiff argues that this issue is not proper subject of a motion to renew, contending that the prior Decision & Order was issued more than two months after defendants provided the Maine Decision to the Court. While plaintiff concedes that this submission was not referenced in the prior decision, he argues that there is no requirement that a Court identify judicial decisions or correspondence provided in connection with a motion.

There is nothing in the record before the Court that establishes whether defendants' submission regarding the Maine Decision was considered on the prior motion. While a ruling adverse to defendants may be implicit in the Court's statement that it "has considered the parties' remaining arguments and finds them unavailing," the Court will nonetheless exercise its discretion to grant leave to renew on the basis of the Maine Decision in order to ensure that defendants have an opportunity to be heard on this argument. However, for the reasons that follow, the Court adheres to its prior determination.

The federal district court in the Maine Action dismissed allegations of misappropriation against the defendant attorneys in connection with plaintiff's federal claims in that action. Count V of Plaintiff's Second Amended Complaint set forth a cause of action for fraudulent transfer, [*4]alleging that certain defendants in that action had made certain payments to another defendant to which plaintiff was entitled. That cause of action did not mention the defendant attorneys. However, in Deep's opposition papers, he ignored the arguments made by the defendants against whom Count V was asserted and instead advanced a completely different theory of fraudulent transfer that focused on alleged misappropriation by the defendant attorneys, the same claims of misappropriation that forms the basis of plaintiff's remaining theory of legal malpractice.

In the absence of any responsive opposition to the arguments put forward by the defendants against whom Count V was directed, the district court considered the claim waived against such defendants. With respect to the new allegations against the defendant attorneys, raised for the first time in Deep's opposition papers, the Court concluded that Deep's arguments were not supported by the complaint. On that basis, the court considered the claim to be waived against the defendant attorneys as well. The federal misappropriation claim was therefore dismissed with prejudice against all defendants in the Maine Action.

The federal court then addressed the state law claims asserted against the defendant attorneys. On this point, the defendant attorneys argued that the federal court should abstain and leave adjudication of these claims to the New York state courts. The district court noted that an action raising claims of "malpractice, negligence, conflicts of interest and the misappropriation of the Aimster asset" already was pending, and the Maine Decision specifically references the name and index number of this action. The district court granted the request of the defendant attorneys to abstain and dismissed the state law claims against them without prejudice.

Despite the federal court's dismissal of Deep's state law claims without prejudice, at the request of the defendant attorneys for the express purpose of allowing such claims to be adjudicated in this forum, defendants nonetheless contend on this motion that the Maine Decision bars plaintiff from pursuing his remaining claim of malpractice in this forum under principles of res judicata.

In support of this argument, defendants primarily rely on the prong of res judicata that bars not only matters actually litigated in a prior action, but matters that could have been litigated. "A judgment in one action is conclusive in a later one not only as to any matters actually litigated therein, but also as to any that might have been so litigated, when the two causes of action have such a measure of identity that a different judgment in the second would destroy or impair rights or interests established by the first" (Schuylkill Fuel Corp. v. Nieberg Realty Corp., 250 NY 304, 306-307 [1929]; Parker v. Blauvelt Volunteer Fire Co., 93 NY2d 343, 347 [1999] ["As a general rule, once a claim is brought to a final conclusion, all other claims arising out of the same transaction or series of transactions are barred, even if based upon different theories or if seeking a different remedy"] [internal quotation omitted]).

"The purpose of this rule is to prevent a party from seeking in a later action to inject matters (theories, grounds, counts, defenses, etc.) that could and should have been used in the first action but were not" (Siegel NY Practice [4th Ed], § 447, p 721). Defendants contend that since Deep raised allegations of misappropriation against them in support of his federal fraudulent-transfer claim and those claims were dismissed with prejudice, Deep is barred from raising that claim, or any variation of it, before this Court.

The fatal flaw in defendants' argument, however, is the fact that the federal court in the [*5]Maine Action expressly dismissed the state law claims without prejudice for the express purpose of allowing them to be litigated in this Court. A federal court's dismissal of state law claims without prejudice does not bar litigation of such claims in state court under res judicata principles (see e.g. McLearn v. Cowen & Co., 60 NY2d 686 [1983]; New York v. Caristo Constr. Corp., 62 NY2d 819, 821 [1984] ["The explicit without prejudice' provision, however, saves the claim from . . . preclusion."]; Urlic v. Insurance Co. of State of Penn., 259 AD2d 1 [1st Dept 1999]).

Thus, for example, in Capital Tel. Co. v. New York Tel. Co. (146 AD2d 312 [1989]), the Third Department recognized that the dismissal of plaintiff's federal antitrust suit would not bar a subsequent state law antitrust suit under the Donnelly Act arising out of the same conduct, explaining:

An exception to the Restatement's rule against "splitting" transactionally related claims exists, however, which is directly applicable here. [Plaintiff] could only have asserted and had its Donnelly Act claim entertained in its Federal antitrust action by reason of the District Court's "pendent" jurisdiction (see, Travelers Indem. Co. v Sarkisian, 139 AD2d 27, 29). But it is clear that once the District Court dismissed [plaintiff's] Federal antitrust claim before trial, as it did, it would have declined to exercise jurisdiction over any accompanying claim based exclusively on State law, and would have dismissed that claim without prejudice to its prosecution in the State courts (see, supra; see also, McLearn v Cowen & Co., 660 F2d 845; McLearn v Cowen & Co., 48 NY2d 696, on rearg 60 NY2d 686). This being so, the adjudication of [plaintiff's] Federal suit does not bar the present Donnelly Act cause of action. "If however, the [Federal] court in the first action would clearly not have had jurisdiction to entertain the omitted theory or ground (or, having jurisdiction, would clearly have declined to exercise it as a matter of discretion), then a second action in a competent court presenting the omitted theory or ground should be held not precluded" (Restatement [Second] of Judgments § 25, comment e [1982] [emphasis supplied]; see also, Restatement [Second] of Judgments § 25, illustration 10 [1982]). Obviously, [plaintiff] should not be held barred for not asserting a claim in the prior Federal action which, if asserted, would not have been adjudicated on the merits. (146 AD2d at 315-16 [emphasis added]).

Of course, in this case, there is no need to predict whether the federal court would have exercised jurisdiction over plaintiff's pendent state-law claims, since the federal court granted defendants' request to abstain and expressly dismissed such claims without prejudice so that they could be litigated in this Court.

Based on the foregoing, it is clear that the Maine Decision does not bar plaintiff from litigating his state-law malpractice claim in this forum.[FN2] Accordingly, on renewal, the Court [*6]adheres to its prior determination.

Statute of Limitations

Defendant also raises two new grounds for summary judgment on this motion. Defendants first argue that plaintiff's claims are time-barred under the three-year statute of limitations applicable to legal malpractice actions (see CPLR 214 [6]). In support of this argument, defendants rely upon an affidavit submitted by Deep in opposition to the prior motion that asserts two injuries supporting his misappropriation-based claim of malpractice: (1) on or about August 24, 2001, when plaintiff was forced to transfer ownership interests in various corporate entities; and (2) on or about June 25, 2002, when plaintiff provided a customized version of the Aimster software and method to be used by Amici.[FN3] Given that this action was commenced in October 2005, defendants argue plaintiff's asserted injuries both fall outside the applicable statute of limitations.

Plaintiff relies primarily on the doctrine of continuous representation, which "tolls the statute of limitations . . . where there is a mutual understanding of the need for further representation on the specific subject matter underlying the malpractice claim" (McCoy v Feinman, 99 NY2d 295, 306 [2002]). Plaintiff contends that purpose of defendants' representation was to assist him in using, developing, licensing and protecting the Aimster software and methods and plaintiff's interest therein in all forms, including copyright and trademark litigation and transactional counseling and representation. Plaintiff further argues that defendants were still representing him in the copyright litigation until November 3, 2002, and that ongoing relationship of trust and confidence attendant to such representation made it impossible for him to sue his attorneys prior to that date.

An action to recover damages arising from an attorney's malpractice must be commenced within three years from accrual (see CPLR 214 [6]). Such a claim accrues "when all the facts necessary to the cause of action have occurred and an injured party can obtain relief in court" (Ackerman v Price Waterhouse, 84 NY2d 535, 541 [1994]). "In most cases, this accrual time is measured from the day an actionable injury occurs, even if the aggrieved party is then ignorant of the wrong or injury' (McCoy, supra, 99 NY2d at 301, quoting id.).

Plaintiff does not dispute that the two claimed injuries occurred more than three years prior to commencement of this action (though, as noted supra, he contends that discovery may provide additional instances of cognizable injuries). In order to survive summary judgment, plaintiff must therefore demonstrate the applicability of the continuous representation doctrine or establish some other basis for tolling the statute of limitations. [*7]

The continuous representation doctrine "'recognizes that a person seeking professional assistance has a right to repose confidence in the professional's ability and good faith, and realistically cannot be expected to question and assess the techniques employed or the manner in which the services are rendered'" (Williamson v. PricewaterhouseCoopers LLP, 2007 NY Slip Op 4719 [2007] [internal quotation omitted]). Thus, where there is a mutual understanding of the need for further representation concerning the subject matter giving rise to the malpractice claim, the statute of limitations is tolled during the course of such representation (id.; see also Greene v. Greene, 56 NY2d 86, 95 [1982] [representation "concerning the same or a related problem"]).

Defendants offer two principal responses to plaintiff's reliance on the doctrine of continuous representation. First, they contend that their representation of plaintiff in the copyright litigation was separate and distinct from the transactional representation giving rise to the misappropriation theory of malpractice that remains before the Court. Second, the defendant attorneys argue that, in any event, their relationship of mutual trust and confidence came to an end no later than September 17, 2002 the date on which they moved to withdraw from the copyright litigation rather than on November 4, 2002, when the federal district court permitted defendants to withdraw.

With respect to defendant's first argument, the Court concludes that disputed issues of fact preclude the grant of summary judgment. While defendants argue, through counsel, that the copyright litigation was separate and distinct from its role in representing plaintiff in the various transactions giving rising to the misappropriation-based claim of malpractice, plaintiff avers that there was a mutual understanding that the defendants would represent him in a comprehensive effort to develop, commercialize and protect the Aimster software and processes. In the absence of any retainer agreement, letter of engagement or other objective indicia concerning the nature and scope of the agreed-upon representation (see Shumsky v. Eisenstein, 96 NY2d 164, 170 [2001]; see also Williamson, supra, [retainer agreement may establish a course of representation for purposes of the continuous representation doctrine]), the Court has no record basis for rejecting, as a matter of law, plaintiff's sworn statement that defendants' representation in the copyright litigation was one component of a specific, comprehensive course of representation from which the malpractice claim asserted herein arose.

Defendants also contend that their relationship of mutual trust and confidence came to an end no later than September 17, 2002, the date on which they moved to withdraw from the federal copyright litigation. As such, they contend that any tolling of the statute of limitations under the continuous representation doctrine which is premised on an ongoing relationship of trust and confidence between the attorney and client ended on such date, rather on November 4, 2002, when defendants ultimately were permitted by the federal district court to withdraw.[FN4]

The extent to which a plaintiff can rely on the continuous representation doctrine in a [*8]situation where an attorney moved to withdraw but was compelled to continue representation, despite a mutual lack of trust and confidence, is an issue that has not been addressed by the Court of Appeals. However, several recent Appellate Division decisions are instructive.

In Aaron v. Roemer, Wallens & Mineaux, (272 AD2d 752 [2000]), the Third Department held that "where the attorney promptly moves to withdraw and the client acknowledges in writing an irreparable deterioration of the attorney-client relationship, we conclude that the relationship necessary to invoke the continuous treatment rule did not persist until formal termination of the nominal representation by defendants, but rather ceased with the disruption of the client's trust and reliance . . . ." This decision supports defendants' argument that a formal termination of the attorney-client relationship, through the granting of a motion to withdraw, is not necessary to a bring an end to the continuous representation toll (see also Shumsky, supra, 96 NY2d at 171). The Aaron decision does not, however, address a situation where an attorney is compelled to continue to zealously represent a client despite a clear mutual breakdown in trust and confidence. Nor does it disclose what constitutes "nominal" representation.

A case closer on point is Deutsch v. Polly N. Passonneau, P.C. (297 AD2d 571 [2002]), in which the First Department addressed a breakdown in the attorney-client relationship following the close of proof in a bench trial, but prior to the issuance of the court's decision and the settling of a judgment. The trial court in that case denied the attorney's motion to withdraw "insofar as counsel seeks to avoid representation with respect to the settlement of the judgment," reasoning that "plaintiff should not be left on her own to deal with the final winding up of the technical details in this complex matter" (id. at 571 [internal quotation omitted]).

In holding that the doctrine of continuous representation applied until the time that a decision was issued and a judgment was entered, the First Department reasoned as follows:

We find that defendant's representation of plaintiff in this matter did not conclude until the August 19, 1997 entry of the judgment . . . . Although the parties had clearly lost trust and confidence in one another by the time of defendant's July 1996 motion to withdraw, the court compelled them to continue their attorney-client relationship for purposes of "winding up" the matter, and plaintiff could not be reasonably expected to sue defendant for malpractice until such winding up had occurred (see Glamm v Allen, 57 NY2d 87, 94).

As in Deutsch, the defendant attorneys' motion to withdraw from the copyright litigation was denied, based on the need for the client to have ongoing representation in order to wind up a complex and substantial matter, notwithstanding a mutual breakdown in trust and confidence. Further, whatever the level of attorney engagement that constituted "nominal" representation in Aaron, the First Department'sdecision recognizes that protecting the interests of a client in settling a judgment or other court order constitutes more than merely nominal representation. Finally, and most fundamentally, the reasoning of Deutsch that it would not be reasonable to expect a client to sue his attorney for malpractice while the lawyer was actively representing him in an ongoing litigation applies with equal force here.

Based on the foregoing, the Court concludes that defendants have not demonstrated, as a matter of law, that plaintiff is unable to satisfy the requirements of the continuous representation doctrine. Accordingly, summary judgment on statute of limitations grounds must be denied.

Plaintiff also claims that the defendant attorneys concealed their severe conflict of interest and, therefore, should be equitably estopped from asserting the statute of limitations. "It is the [*9]rule that a defendant may be estopped to plead the Statute of Limitations where plaintiff was induced by fraud, misrepresentations or deception to refrain from filing a timely action" (Simcuski v. Saeli, 44 NY2d 442, 448-49 [1978]). "For the doctrine to apply, a plaintiff may not rely on the same act that forms the basis for the claim — the later fraudulent misrepresentation must be for the purpose of concealing the former tort" (Ross v. Louise Wise Servs., Inc., 8 NY3d 478, 491 [2007]). The uncommon remedy of equitable estoppel "is triggered by some conduct on the part of the defendant after the initial wrongdoing; mere silence or failure to disclose the wrongdoing is insufficient" (id. [internal quotation omitted]).

Here, the basis for the asserted estoppel is defendants' alleged failure to disclose conflicts of interest. This is the same conduct that forms, at least in part, the basis of defendants' complaint of professional malpractice. Accordingly, plaintiff's reliance on equitable estoppel to preclude defendant's from relying on the statute of limitations must be rejected.

Bankruptcy Litigation

Defendants also argue that the doctrine of judicial estoppel bars Deep from asserting that his software was misappropriated. In making this argument, defendants point to a November 28, 2006 bankruptcy filing by plaintiff that allegedly demonstrates that Deep had been concealing his purported interest in the subject software from creditors in two prior bankruptcy filings.

In a bankruptcy schedule filed on August 26, 2003, plaintiff listed his interests in the "Madster website and domain," "copyrighted software and text joint ownership with JDCI, LLC," "the source code for Aimster and other work products" and ownership interest in several corporations involved in the development and commercialization of the Aimster/Madster software. Similar disclosures were made in a schedule filed by plaintiff on February 8, 2005. The 2005 filing also disclosed plaintiff's interest in certain litigation claims, including a claim for fraudulent transfer.

Plaintiff's most recent bankruptcy filing of record, dated November 24 2006, discloses the foregoing assets, but also lists plaintiff's interest in this litigation, as well as a claim for

ongoing infringement of his rights in the Aimster/Madster software and processes by Amici and/or Xerox. Thus, defendant argues that the prior failure of Deep to disclose his purported interest in the Aimster software that he claims was misappropriated by Amici bars his misappropriation-based claim of legal malpractice.

The doctrine of judicial estoppel bars a debtor who fails to disclose a claim in bankruptcy proceedings from asserting such claim after emerging from bankruptcy (Kunica v. St. Jean Financial, Inc., 233 BR 46, 58-59 [SDNY 1999]; see also Whelan v. Longo, 7 NY3d 821 [2007] [plaintiff's failure to disclose cause of action in bankruptcy petition deprived her of the legal capacity to sue]). In this case, however, the Court concludes that defendants have failed to establish, as a matter of law, that application of an estoppel is warranted.

As noted supra, each of the bankruptcy filings before the Court list the "Madster" web site and copyrighted software as an asset of plaintiff. It is undisputed that the Madster software and web site are the same as the Aimster software and web site. Thus, the intellectual property associated with the Aimster/Madster software and web site consistently were disclosed to the Bankruptcy Court (and to plaintiff's creditors).

To be sure, as defendants assert, plaintiff's most recent filing with Bankruptcy Court, also discloses Deep's interest in this litigation, as well as a claim for ongoing infringement by Amici [*10]of his rights in the Aimster/Madster software. However, to succeed on this motion, defendants must establish that plaintiff not only failed to disclose his interest in these claims, but also that he knew or should have known of such claims at the time of the earlier filings. The Court concludes that the limited factual record does not provide a sufficient basis to establish this element as a matter of law.[FN5]

Defendants place great weight on the affidavit of Edwin Kear, who avers that he assisted Deep in providing a customized version of the proprietary Aimster software to Amici in mid 2002. This, the defendant attorneys contend, demonstrates both that plaintiff knew of the transfer of assets prior to the bankruptcy filings at issue and forecloses his contention that the Aimster software was misappropriated. The Court disagrees. The limited factual record before the Court, compiled in the absence of any significant pre-trial discovery, fails to disclose the term and conditions of the 2002 transactions and plaintiff's knowledge, whether actual or constructive, of the alleged misappropriation at that time. Further, plaintiff's claim here is one for legal malpractice grounded on defendant's alleged breach of duty that resulted in a misappropriation of the Aimster/Madster assets and the record does not permit the Court to establish, as a matter of law, when plaintiff knew or should have known of such claim. Finally, defendants' arguments regarding the lack of any misappropriation must fail in light of the prior Decision & Order, in which the Court concluded that disputed issues of fact preclude the granting of summary judgment on the misappropriation-based claim of malpractice. Under these circumstances, defendants have not met their burden of demonstrating the applicability of judicial estoppel.

Leave to Amend

Plaintiff cross-moves for leave to amend his complaint to add a claim of fraud against defendants. "Leave to amend a pleading is discretionary and trial court orders generally will not be disturbed where there is no prejudice or surprise to the nonmoving party resulting from the delay and the proposed amendment is not plainly lacking in merit" (Turner v. Caesar, 2 AD3d 1086 [3d Dept. 2003]; see also CPLR 3025 [b]). However, leave to amend a pleading should not be granted where the proposed amendment would be futile (see Saferstein v Mideast Systems, Ltd., 143 AD2d 82 [2rd Dept 1988]). Further, a fraud claim will not lie where it is premised on the same conduct that forms the basis of a legal malpractice complaint (see Ruggerio v. Powers, 284 AD2d 593, 595 [3d Dept 2001]).

It is apparent from plaintiff's motion papers that his claim of fraud is, in fact, premised on the same allegations of misconduct that underlie his malpractice claim. Further, plaintiff has not submitted a new pleading setting forth his new proposed claim of fraud with particularity. Under these circumstances, the Court declines to grant plaintiff leave to amend.

The Court has considered the parties' remaining contentions and finds them to be without merit.

ORDERED that defendants' motion for reargument is denied in its entirety; and it is [*11]further

ORDERED that defendants' motion for renewal is granted, and upon renewal, the Court adheres to the rulings set forth in the prior Decision & Order of this Court (McCarthy, J.), dated December 22, 2006; and it is further

ORDERED that defendants' motion for summary judgment is denied in its entirety; and it is further;

ORDERED that plaintiff's motion to leave to amend his complaint is denied.

This constitutes the Decision and Order of the Court. All papers including this Decision and Order are returned to counsel for defendants. The signing of this Decision and Order shall not constitute entry or filing under CPLR Rule 2220. Counsel is not relieved from the applicable provisions of that Rule respecting filing, entry and Notice of Entry.

Dated: Albany, New York

August 9, 2007

RICHARD M. PLATKIN

A.J.S.C.

Footnotes


Footnote 1: Familiarity with the facts of this case, as set forth in the prior Decision & Order, is assumed. The Court will repeat only those facts necessary to resolve the instant motions.

Footnote 2: The Court notes that it received a letter from defendants, dated July 2, 2007, which enclosed a copy of a recent, related decision from the federal district court in Maine (Deep v. Boise et al., Civ. No. 07-53-P-H [June 26, 2007]). Apparently, plaintiff filed a new action in that jurisdiction that is essentially the same as the prior Maine Action, but with one significant addition: a request for a declaration that the state law claims pending before this Court are not barred by the Maine Decision. The federal court dismissed the new complaint, and explained that it had no jurisdiction to "tell the New York court what effect my Order has on the state claims pending there." The federal court did note, however, that "[w]hat Deep has left is state claims." The Court sees nothing in this decision to alter its conclusion regarding the inapplicability of res judicata to this action.

Footnote 3: Plaintiff also argues that pre-trial discovery in this matter would likely yield additional instances of misappropriation or other injuries supporting the remaining claim of malpractice. While the Court believes there may be merit to this argument, it is unnecessary to reach this point, based on the conclusion, set forth infra, that defendants have not demonstrated an entitlement to summary judgment based on the two instances of alleged misappropriation before the Court.

Footnote 4: On October 9, 2002, the federal district court denied defendants' first motion to withdraw, finding that defendants' continued representation of plaintiff was necessary to avoid delaying the entry of a preliminary injunction that would prevent irreparable harm to the plaintiffs in that action. The defendant attorneys moved again on November 1, 2002 to withdraw, and their motion was granted on November 4, 2002.

Footnote 5: It should also be noted that plaintiff's 2003 and 2005 filings do disclose litigation in which he asserts a claim of fraudulent conveyance. While details about this litigation are not apparent in the record, the Court notes that plaintiff's fraudulent conveyance claim in the Maine Action was the initial vehicle by which he raised allegations of misappropriation against the defendant attorneys.