| Bass Oil & Chemicals LLC v Bass |
| 2014 NY Slip Op 50684(U) [43 Misc 3d 1217(A)] |
| Decided on April 28, 2014 |
| Supreme Court, Kings County |
| Demarest, 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| This opinion is uncorrected and will not be published in the printed Official Reports. |
Bass Oil and
Chemicals LLC, Sarah Roz as Executor of the Estate of Hershel Roz, Ronnie Roz, and
Leonard Roz, Plaintiffs,
against Gregory Bass, Alexander Bass, Bass Oil Company, Inc., Auto Club Il Chemicals Corp., Lubricant Network Inc., MG Lube Inc. and Citilube, Inc., Defendants. |
The following e-filed papers read herein:
Papers [*2]Numbered
Notice of Motion/Order to Show Cause/
Petition/Cross Motion and
Affidavits (Affirmations) Annexed42-49
Opposing Affidavits (Affirmations)55
Reply Affidavits (Affirmations)
Affidavit (Affirmation)
Other Papers
In this action by plaintiffs Bass Oil and Chemicals LLC (Bass OAC), Sarah Roz as
Executor of the Estate of Hershel Roz (Hershel),[FN1] Ronnie Roz (Ronnie), and Leonard
Roz (Leonard) (collectively, plaintiffs) against Gregory Bass (Gregory), Alexander Bass
(Alexander), Bass Oil Company, Inc. (Bass Oil), Auto Club IL Chemicals Corp. (Auto
Club), Lubricant Network Inc. (Lubricant), MG Lube Inc. (MG Lube), and Citilube, Inc.
(Citilube) (collectively, defendants) alleging claims of fraud, breach of contract, and
unjust enrichment, and seeking to recover damages in excess of $5,000,000, plaintiffs
move, under motion sequence number 4, for an order, pursuant to CPLR 3211 (a) (7),
dismissing defendants' second and third counterclaims for failing to state a cause of
action, or, in the alternative, for an order, pursuant to CPLR 3013 and 3211 (a) (7),
dismissing these counterclaims for failing to plead causes of action with the requisite
particularity.
In June 2010, Hershel (who is now deceased) and his two sons, Ronnie and Leonard, were seeking to purchase a business and were put in touch, through a business broker, with Gregory and Alexander (who are brothers), who were seeking to sell the assets of their oil/lubrication companies. After negotiations, Hershel, Ronnie, Leonard, and the limited liability company to be formed by them, Bass OAC, agreed to purchase [*3]these assets. On June 28, 2010, Bass Oil, Auto Club, Lubricant Network, and MG Lube, as sellers, which had their principal place of business at 136 Morgan Avenue, in Brooklyn, New York (the 136 Morgan Avenue premises), and Hershel, Ronnie, and Leonard, as buyers, executed an Asset Purchase Agreement.
Section 1 (a) of the Asset Purchase Agreement provided as follows:
"Subject to the terms and conditions of this Agreement, at the Closing . . . the Seller[s] agree[] to sell to the Buyer[s], and the Buyer[s] agree[] to buy from the Seller[s], certain assets of the oil and related products business of the Seller[s] (the Business'). The Business also includes the ability to make approximately 200 products, including antifreeze and power steering fluid and which includes the formulas for creating same. The Business shall include all inventory of the Business, all assets used in the operation of the Business including but not limited to telephone equipment and systems and all computer equipment, office equipment and supplies, all warehouse equipment and racks, customer lists and records, the goodwill of the Business, the names Bass Oil . . . Auto Club . . . Lubricant Network, and MG Lube, all intellectual property including but not limited to trademarks, trade names, trade dress, copyrights and patents, if any, its telephone and fax numbers and any e-mail or web address used in the Business . . . all of which shall be free and clear of any debts, mortgages, security interests or other liens or encumbrances except to the extent otherwise provided for herein . . ."
An itemized list of the equipment and supplies sold and a list of customers were annexed to the Asset Purchase Agreement. Section 4 (a) of the Asset Purchase Agreement provided that the purchase price to be paid by plaintiffs was $5,000,000. Of this purchase price, $250,000 was paid by plaintiffs upon the signing of the Asset Purchase Agreement and $2,750,000 was paid at the closing, and the balance of $2,000,000 was to be paid monthly over five years with interest at the rate of eight percent per annum evidenced by assignable promissory notes. The notes were secured by UCC-1 filings on all of the assets sold, as well as by personal guarantees executed by Hershel, Ronnie, and Leonard, and confessions of judgment executed by all three personal guarantors and the purchasing entity, Bass OAC. Section 4 (b) of the Asset Purchase Agreement provided that the Sellers were required to obtain a lease extension of five years, which was in addition to the balance of the existing lease of approximately 2.5 years. [*4]
Section 4 (c) of the Asset Purchase Agreement specifically provided that the Buyers would purchase the inventory of the Sellers' Business for an amount estimated to be between $750,000 and $1,000,000, and that any amount in excess of $1,000,000 could be purchased at the Buyers' option. This inventory was to "be paid for based upon a physical inventory, paid dollar for dollar at the closing." The Sellers represented that "the inventory will not be damaged and does not become stale as it has no shelf life."
Section 10 of the Asset Purchase Agreement provided that after the closing of the sale, Gregory and Alexander would work for plaintiffs during normal business hours for the purpose of training them and introducing them to customers, with no salary to be received, for a period of 30 days after closing. Section 24 of the Asset Purchase Agreement contained a restrictive covenant, which restricted Gregory and Alexander from entering into or conducting any business to sell to retail stores, gas stations, and car repair shops within 80 miles of the 136 Morgan Avenue premises for a period of three years following the date of the closing of the asset sale, and from doing any bottling of automobile products within 150 miles of the 136 Morgan Avenue premises for a period of five years.
Section 4 (d) of the Asset Purchase Agreement set forth that the purchase price was "allocated" to the Buyers' receiving of the equipment and materials, the restrictive covenant given by Gregory and Alexander, the assignment of the lease, and the good will and assignment of the trade names and telephone numbers of the Business.
The closing took place on November 11, 2010. In addition to the $5,000,000 purchase price of the assets, plaintiffs purchased defendants' inventory, pursuant to Section 4 (c) of the Asset Purchase Agreement, for $1,644,951.55. After the closing of the sale, pursuant to section 10 of the Asset Purchase Agreement, Gregory continued to work at the 136 Morgan Avenue premises and advise plaintiffs as to the Business for 30 days.
Plaintiffs assert that when they purchased the assets from defendants, they relied on numerous express representations made by Gregory and Alexander both before and after the closing, as well as on the fact that Bass Oil had been in business for over 23 years before they purchased its assets. Plaintiffs claim that defendants concealed significant material facts from them, and that if they had known the true facts, they would have walked away from the sale. Plaintiffs allege that these material facts included the fact that defendants' products did not possess the industry recognized certifications as contained on their labels as sold to them, that the fuel/oil products sold to them were not the actual products which defendants had represented were being sold to them, and that the formulas that defendants sold to them were obsolete for the use intended.
Plaintiffs claim that over the course of time, they learned that they had "been duped" by defendants because the majority of what they had purchased from them was worthless. Specifically, plaintiffs assert that despite the fact that defendants represented in section 4 (c) of the Asset Purchase Agreement that the inventory would "not become [*5]stale as it ha[d] no shelf life" and that they were purchasing the inventory "dollar for dollar" and paid defendants $1,644,951.55 for their inventory, they learned, after Gregory was no longer advising them post-closing, that some of the inventory did, in fact, have a shelf life and had already expired. Among these allegedly expired products was a product dated 2003, about which plaintiffs contacted Shell Oil, whose representative allegedly told them that the product should be thrown out because it had only about a four-year shelf life.
Plaintiffs assert that not only did some of the inventory have a shelf life, but some of it had also already expired when they purchased it from defendants. Plaintiffs claim that some of the products were unable to be sold, and others were considered toxic waste for which they incurred expenses in order to properly dispose of them.
Plaintiffs further assert that although defendants had charged them full price for these products, they learned that most of the inventory was purchased by defendants from Shell Oil at closeouts for approximately 30 cents on the dollar. Plaintiffs allege that they learned from ADI, another oil lubricants and parts distributor who shared in defendants' purchase from Shell Oil at the closeouts, that they overpaid by approximately $500,000 to $600,000 for the inventory.
Plaintiff additionally assert that on or about November 18, 2011, the Petroleum Quality Institute of America (PQIA), an industry watchdog for the petroleum industry, issued a Consumer Alert regarding Maxiguard Super Premium Motor Oil, API, SA, SC SAW 10E-40, which was one of the main products purchased by them from defendants. This Consumer Alert stated that this product, despite claiming to be SAW 10E-40 oil, was, according to its analysis, an SAE 10W-20 oil and that its volatility result did not support the use of "high grade petroleum base stocks" as represented. It further stated that the oil lacked the appropriate levels of anti-wear and detergent additives required for modern engines and may also contain used oil. In addition, the alert stated that the label claims of API service SA, SC, were obsolete Service Categories that the American Petroleum Institute (API) cautioned could cause harm to engines built after 1967, and that the label did not warn consumers of this limited use.
Plaintiffs further state that an article published on or about June 2, 2012, in Jobbers World, which is the industry's trade magazine, reported that the PQIA had issued a "Don't Buy" on MaxiGuard Super Premium Motor Oil, and also that a Consumer Alert was issued on Auto Club Automatic Transmission Fluid. Plaintiffs assert that on the same date, a Consumer Alert was posted by the PQIA with respect to XTREME 2000 Super Premium SAE 10W-30 Motor Oil, API, SF, which stated that its test results showed that this product was not a 10W-30, that API SF was an obsolete specification that was not recommended for engines built after 1988, and that the label on this product failed to give adequate warning to consumers about its limited use.
Plaintiffs claim that after continuing to investigate the products sold to them by defendants, they learned that the formulas sold by defendants were inferior products that [*6]were obsolete at the time they purchased them, that they could not be sold to existing and new markets, and that they were required to recall any outstanding products. Plaintiffs assert that defendants never updated their motor oil products over the course of time as engine needs evolved and that they never changed the labels on their products. Plaintiffs state that as a result, they were required to create new formulas to improve the quality of the products and were unable to sell the products purchased from defendants under the MaxiGuard, XTREME, or Auto Club labels, rendering all goodwill purchased by them from defendants to be worthless. Plaintiffs further state that they had to destroy the "fraudulent labels" sold by defendants and to expend substantial monies to create new labels for their products.
In addition, on January 11, 2013, plaintiffs received a cease and desist letter written to Alexander by counsel to API, which publishes engine oil service category standards for automobiles and operates the industry recognized certification program for engine oils based upon these standards. Plaintiffs state that this letter advised them that Auto Club had been improperly using API's two federally registered certification marks on its labels, and that Auto Club brand engine oil had not been validly certified by API since 2005. Plaintiffs claim that the labels for the products which were purchased by them from defendants constituted trademark infringement since the API marks were being used without API's permission, that the products containing the API marks failed to meet the API standards for such marks, and that the labels were actually fraudulent to any purchasers of such products. Plaintiffs allege that after receiving the cease and desist letter from API, they were required to cease selling the products containing those marks, had to retain intellectual property counsel to resolve the issues with API, and had to make a $10,000 payment to API in settlement of API's trademark infringement claims against it.
Plaintiffs also assert that due to defendants' alleged frauds with respect to the API marks, API would not consider certifying their products until they received full responses from defendants as to queries they made to defendants regarding defendants' use of the API marks. They state that due to defendants' alleged frauds with respect to the API marks, they were required to stop their substantial marketing campaign with respect to the roll out of their product, Dash Motor Oil, since they were unable to timely receive API approval for it, which is critical to the success of this product.
Plaintiffs further claim that defendants have taken improper actions to try to injure their business. They allege that Gregory "poached" Louis Aulet, the floor manager and head chemist at Bass Oil, within two years of their purchase of the business, and that another long time Bass Oil employee, Jose Rivera, also quit to work for defendants, who are now operating a business in Florida. They assert that Gregory has instructed Randy Pratt of Environmental Waste Pro, Inc. that he could not sell products to them, and that defendants have also instructed other suppliers of oil products not to sell to them. They further assert that defendants did not introduce them to the majority of their suppliers because they sought to purchase goods directly and then resell the goods to them in order [*7]to make a profit.
On June 11, 2013, plaintiffs filed this action against defendants. Plaintiffs' verified complaint alleges three causes of action. Plaintiffs' first cause of action for fraud alleges that defendants' false representations caused them to purchase their business and inventory at substantially inflated prices, that defendants falsely represented to them that they had properly maintained API certification when, in fact, they had been using the API symbols in violation of federal trademark laws, that defendants falsely represented the quality and vitality of the purchased inventory, and that defendants falsely represented that they would not interfere with the operation and management of the business but actively concealed plans to move employees to their new business. Plaintiffs' second cause of action for breach of contract alleges that defendants breached the Asset Purchase Agreement by failing to provide the business, goodwill, and inventory as provided in this agreement and by failing to indemnify them for any lawsuits or other costs that they might incur by reason of defendants' actions or inactions. Plaintiffs' third cause of action for unjust enrichment alleges that they provided significant consideration to defendants, that a substantial portion of the inventory was worthless, that they were forced, at considerable expense, to dispose of unusable inventory and to cover the costs of defendants' alleged infringement on the federal trademark of API, and that they had to substitute a significant amount of the purchased inventory. Plaintiffs seek at least $5,000,00 in damages.
On July 11, 2013, defendants interposed an answer dated July 9, 2013, which contains denials and defenses and three counterclaims. Defendants' first counterclaim alleges that plaintiffs executed 12 notes in connection with the purchase of the inventory by Bass OAC, each in the sum of $36,198.92, and that following discussions between them and plaintiffs, 10 notes were returned to plaintiffs and a corresponding amount of inventory that had been sold was taken back by them. Defendants assert, in this counterclaim, that two notes (number 11 and number 12) in the total sum of $72,399.84 remain due and owing, together with interest in connection therewith, and they demand payment on these notes, together with interest, costs and disbursements, and attorneys' fees in connection therewith.
Defendants' second counterclaim alleges that Bass Oil has been in business for over 23 years, and that during this period, it has attained a good reputation in the industry for quality merchandise and consumer satisfaction. Defendants assert, in this counterclaim, that plaintiffs, rather than using proper materials, utilized used oil in their own products, which constitutes a misleading of consumers. They allege that upon changing suppliers, new formulas had to be implemented because each supplier utilizes different raw materials. They further allege that during the past two years, plaintiffs had several recalls of their products due to plaintiffs' use of used oil, and that there were several media alerts warning consumers against purchasing plaintiffs' products. They claim that as a result, their reputation has been damaged by plaintiffs to the extent of $5,000,000. [*8]
Defendants' third counterclaim alleges that Citilube was formed in New York on October 12, 2004 and, in October 2012, it became a Florida corporation. Defendants assert, in this counterclaim, that Citilube had no dealings whatsoever with plaintiffs, that the naming of Citilube in this action was merely for harassment, and that Citilube has lost its good commercial reputation and was besmirched in the marketplace by plaintiffs' lumping it with the other defendants. Defendants claim that Citilube has been damaged in the sum of $5,000,000.
By an order dated July 19, 2013, the court, on consent of the counsel for all parties,
consolidated a declaratory judgment action (filed under index number 503923/2013) by
plaintiffs with respect to the two notes that are the subject of defendants' first
counterclaim with this action. Plaintiffs assert that the first counterclaim has been
satisfied. On August 1, 2013, plaintiffs e-filed their instant motion to dismiss defendants'
second and third counterclaims.[FN2]
It is well settled
that as a general rule, "[w]hen assessing a motion to dismiss a complaint or counterclaim
pursuant to CPLR 3211 (a) (7) for failure to state a cause of action, the court must afford
the pleading a liberal construction, accept as true all facts as alleged in the pleading,
accord the pleader the benefit of every possible inference, and determine only whether
the facts as alleged fit within any cognizable legal theory" (Baker, Sanders, Barshay,
Grossman, Fass, Muhlstock & Neuworth, LLC v Comprehensive Mental Assessment &
Med. Care, P.C., 110 AD3d 1022, 1023 [2d Dept 2013] see also Goldman v Metropolitan
Life Ins. Co., 5 NY3d 561, 570-571 [2005] Leon v Martinez, 84 NY2d
83, 87-88 [1994] Mazzei v
Kyriacou, 98 AD3d 1088, 1089 [2d Dept 2012] Yellow Book Sales & Distrib. Co.,
Inc. v Hillside Van Lines, Inc., 98 AD3d 663, 664 [2d Dept 2012]). Thus, when
evaluating whether a pleading is sufficient to survive a motion to dismiss pursuant to
CPLR 3211 (a) (7), initially, " the sole criterion is whether the pleading states a cause of
action, and if from its four corners factual allegations are discerned which taken together
manifest any cause of action cognizable at law a motion for dismissal will fail'" (Ruffino v New York City Tr.
Auth., 55 AD3d 817, 818 [2d Dept 2008], quoting Morris v Morris, 306
AD2d 449, 451 [2d Dept 2003] see also 511 W. 232nd Owners Corp. v Jennifer
Realty Co.,
98 NY2d 144, 151-152 [2002]).
" However, bare legal conclusions are not entitled to the benefit of the presumption of truth and are not accorded every favorable inference'" (Ruffino, 55 AD3d at 818, quoting Morris, 306 AD3d at 451). Any allegation that states purely legal [*9]opinions or conclusions, rather than facts, will not be afforded any weight (see Asgahar v Tringali Realty, Inc., 18 AD3d 408, 409 [2d Dept 2005] Kliebert v McKoan, 228 AD2d 232 [1st Dept 1996], lv denied 89 NY2d 802 [1996]). Therefore, dismissal of the pleading pursuant to CPLR 3211 (a) (7) "will be warranted . . . in those situations in which it is conclusively established that there is no cause of action" (Town of N. Hempstead v Sea Crest Constr. Corp., 119 AD2d 744, 746 [2d Dept 1986]).
In addition, CPLR 3013 provides that "[s]tatements in a pleading shall be sufficiently particular to give the court and parties notice of the transactions, occurrences, or series of transactions or occurrences, intended to be proved and the material elements of each cause of action or defense."
Here, as discussed above, defendants' second counterclaim asserts that they have sustained damage to their reputation in the industry for quality merchandise and consumer satisfaction due to actions taken by plaintiffs in utilizing used oil in their products and because plaintiffs had several recalls caused by their use of used oil and there were several media alerts warning consumers against purchasing plaintiffs' products. Plaintiffs allege, however, that the product recalls and consumer alerts were actually the result of defective products and formulas which were sold to them by defendants with improper labels.
In any event, these recalls and consumer warnings in the operation of plaintiffs' business occurred after defendants had sold their assets to plaintiffs. Defendants fail to explain how plaintiffs' operation of their own business had any effect on them or how plaintiffs could have damaged their reputation when they no longer had any interest in plaintiffs' business assets after they sold the business under the Asset Purchase Agreement. As discussed above, section 1 (a) and section 4 (d) of the Asset Purchase Agreement provided that defendants sold the goodwill of the business and assigned all trade names, trademarks, and trade dress to plaintiffs. Thus, defendants no longer possessed an interest in these trade names and their reputation could not have been damaged by any recall or media alerts regarding plaintiffs' products.
Furthermore, while defendants allege damage to their reputation, this does not state any independent cognizable cause of action, and defendants fail to allege what cause of action they are attempting to allege in this counterclaim. Although this counterclaim appears to purport to allege a cause of action for prima facie tort, "[t]he requisite elements of a cause of action sounding in prima facie tort include (1) intentional infliction of harm, (2) resulting in special damages, (3) without excuse or justification, (4) by an act or series of acts which are otherwise legal" (Smallwood v Lupoli, 107 AD3d 782, 783 [2d Dept 2013]).
"An element of a prima facie tort cause of action is that the complaining party suffered specific and measurable loss, which requires an allegation of special damages" (Diorio v Ossining Union Free School Dist., 96 AD3d 710, 712 [2d Dept 2012] see also Del Vecchio v Nelson, 300 AD2d 277, 278 [2d Dept 2002]). Defendants fail to allege any [*10]specific or measurable damages. Defendants merely allege general damages in the amount of $5,000,000. They do not explain with any particularity how this amount was ascertained nor do they identify any actual losses causally related to plaintiffs' alleged tortious acts.
Additionally, "central to a cause of action alleging prima facie tort is that the plaintiff's intent was motivated solely by malice or disinterested malevolence'" (Diorio, 96 AD3d at 712, quoting Simaee v Levi, 22 AD3d 559, 563 [2d Dept 2005] see also Etzion v Etzion, 62 AD3d 646, 651 [2d Dept 2009], lv dismissed 13 NY3d 824 [2009] Lancaster v Town of E. Hampton, 54 AD3d 906, 908 [2d Dept 2008]). While defendants allege that plaintiffs' actions caused them harm, they fail to allege that the harm was intentionally inflicted without justification or that plaintiffs' actions were motivated solely by disinterested malevolence. Thus, defendants' second counterclaim fails to state a claim for prima facie tort.
Defendants' third counterclaim seeks to recover damages for harm to Citilube caused by its being named as a defendant in this action. Gregory, who is the president and a shareholder and officer of Citilube, has submitted an affidavit, in which he asserts that Citilube never did any business nor had any dealings with plaintiffs. He states that Citilube was named as a defendant only for purposes of harassment and to damage its good reputation. Plaintiffs, however, assert that they named Citilube as a defendant because defendants have, on occasion, directed that payment for the sale of the Business be made by them to Citilube, and defendants admit that, on several occasions, Bass Oil has made Citilube the payee of the notes.
In liberally construing defendants' third counterclaim, it appears to purport to allege a cause of action for malicious prosecution or abuse of process. "The elements of the tort of malicious prosecution of a civil action are (1) prosecution of a civil action against the [party alleging malicious prosecution], (2) by or at the instance of the [other party], (3) without probable cause, (4) with malice, (5) which terminated in favor of the [party alleging malicious prosection], and (6) causing special injury" (Castro v East End Plastic, Reconstructive & Hand Surgery, P.C., 47 AD3d 608, 609 [2d Dept 2008] see also Engel v CBS, Inc., 93 NY2d 195, 201 [1999] Colon v City of New York, 60 NY2d 78, 82 [1983], rearg denied 61 NY2d 670 [1983] Martin v City of Albany, 42 NY2d 13, 16 [1977] Thyroff v Nationwide Mut. Ins. Co., 57 AD3d 1433, 1435 [4th Dept 2008], rearg denied 60 AD3d 1439 [4th Dept 2009], appeal dismissed 12 NY3d 911 [2009], lv denied 13 NY3d 710 [2009] Broughton v State of New York, 37 NY2d 451, 457 [1975], cert denied sub nom. Schanbarger v Kellogg, 423 US 929 [1975] Wilhelmina Models, Inc. v Fleisher, 19 AD3d 267, 269 [1st Dept 2005] Hornstein v Wolf, 109 AD2d 129, 132 [2d Dept 1985], affd 67 NY2d 721 [1986] Molinoff v Sassower, 99 AD2d 528, 529 [2d Dept 1984]).
As to the requirement that the party seeking to assert a claim of malicious prosecution must allege and prove "special injury," it has been held that "[t]he mere [*11]bringing of a civil suit, even if groundless and ill motivated, does not result in special damage or injury sufficient to sustain an action for malicious prosecution" (Hornstein, 109 AD2d at 132). To show special injury, "the defendant must abide some concrete harm that is considerably more cumbersome than the physical, psychological or financial demands of defending a lawsuit" (Engel, 93 NY2d at 305; see also Wilhelmina Models, Inc., 19 AD3d at 269). The party is required to allege interference with his or her person or property because of resort to a provisional remedy, such as arrest, attachment, injunction, receivership, or notice of pendency, or something substantially equivalent to the provisional remedy effect (see Engel, 93 NY2d at 205; Muro-Light v Farley, 95 AD3d 846, 846-847 [2d Dept 2012] Dermigny v Siebert, 79 AD3d 460, 460 [1st Dept 2010] Greco v Christoffersen, 70 AD3d 769, 770 [2d Dept 2010] Shatkin v Drescher, 24 AD3d 1292, 1293 [4th Dept 2005] Wilhelmina Models, Inc., 19 AD3d at 269; Griffin v Tedaldi, 228 AD2d 554, 555 [2d Dept 1996] Jurow v Brickman House, 159 AD2d 562, 562-563 [2d Dept 1990] Molinoff, 99 AD2d at 529; Clark v MacKay, 97 AD2d 394, 395 [2d Dept 1983] Ellman v McCarty, 70 AD2d 150, 155 [2d Dept 1979]). There is no allegation by defendants of such special damage or injury sufficient to sustain this claim.
Abuse of process requires the pleading of three elements: 1) regularly issued process 2) with an intent to do harm without cause or justification and 3) the perverted use of process to obtain a collateral objective (Curiano v Suozzi, 63 NY2d 113, 116 [1984] Greco v Christoffersen, 70 AD3d 769, 770 [2d Dept 2010]). As plaintiffs contend, and defendants admit, Citilube was the designated payee of some of the payments made to defendants pursuant to the Asset Purchase Agreement. Plaintiffs have thus established a legitimate basis to join Citilube as a defendant and defendants cannot establish either the lack of good cause or an unjustified purpose solely to cause harm so as to support a cause of action either for malicious prosecution or abuse of process.
Defendants, in opposition to plaintiffs' motion, fail to provide any support to their
counterclaims, but merely assert that the court should give full credence to their
allegations for the purpose of determining the motion. However, even affording
defendants' allegations liberal construction, defendants do not plead any legally viable
cause of action in their second and third counterclaims, and their mere conclusory
allegations are insufficient to sustain these counterclaims (see generally Asgahar,
18 AD3d at 409; Kliebert, 228 AD2d at 232). Furthermore, these counterclaims
are not sufficiently particular to give notice to the court and plaintiffs of their material
elements since they fail to adequately plead the requisite elements to support any
cognizable claim (see CPLR 3013). Dismissal of defendants' second and third
counterclaims is, therefore, mandated (see CPLR 3211 [a] [7]).
Accordingly, plaintiffs' motion for an order dismissing defendants' second and third counterclaims as against them is granted.
This constitutes the decision and order of the court. [*12]
E N T E R,
J. S. C.