Supreme Court, Richmond County

Decided on May 19, 2026

Index No. 151235/2025

Paul Marrone, Jr., J.

[*1]

Recitation, as required by CPLR § 2219 (a), of the papers considered in the review of this motion:

Papers NYSCEF Document(s)

Defendant Satmar/Defendant Rosenfeld/Defendant Weber/

Defendant 63NY's (Motion #2) to Dismiss, with supporting

documents (filed October 22, 2025) 33 — 37

Defendant YJV's Motion (#3) to Dismiss, with supporting documents (filed October 31, 2025) 39 — 54

Plaintiffs' Opposition to the Defendant Satmar's Motion (#2), with supporting documents (filed December 1, 2025) 57 — 69

Defendant Taub's Motion (#4) to Dismiss, with supporting documents (filed December 9, 2025) 70 — 76

Plaintiffs' Opposition to Defendant YJV's Motion (#3), with supporting documents (filed December 9, 2025) 78 — 80

Satmar Defendants' Reply to Plaintiffs' Opposition (#2), with supporting document (filed December 10, 2025) 81 — 82

Defendant YJV's Reply to Plaintiffs' Opposition (#3), with supporting document (filed December 17, 2025) 83 — 84

Plaintiffs' Opposition to Defendant Taub's Motion (#4), with supporting documents (filed January 5, 2026) 92 — 96

Defendant Taub's Reply to Plaintiffs' Opposition (#4) (filed January 10, 2026) 98

Within the instant motion (Motion #2), Satmar Nelson, LLC ("Defendant Satmar"), Henry Rosenfield, also known as Henry Rosen and Henry Rosenfeld ("Defendant Rosenfeld"), Naftoli Weber ("Defendant Weber"), and 63 NY, LLC "Defendant 63NY"), defendants in this action, seek dismissal of the Complaint pursuant to CPLR 3211 (a) (1), (3), and (7). YJV Capital, LLC ("Defendant YJV"), another defendant, moves (Motion #3) to dismiss the [*2]Complaint pursuant to CPLR 3211 (a) (1) and (7). Finally, Scott Taub ("Defendant Taub"), another defendant, separately moves (Motion #4) to dismiss the Complaint pursuant to CPLR 3211 (a) (1) and (7), or, in the alternative, for summary judgment pursuant to CPLR 3212.

PROCEDURAL HISTORY

This action was commenced by the filing of a Summons, Complaint, and Notice of Pendency on April 30, 2025. Defendant Taub interposed an Answer with cross-claims on July 11, 2025. Defendant Satmar, Defendant Rosenfeld, Defendant Weber, and Defendant 63NY jointly interposed an Answer on July 24, 2025. As of the date of this decision, Defendant YJV has not interposed an Answer.

On December 18, 2025, the Court issued a decision and order granting, without opposition from any defendant, Plaintiffs' motion to stay the enforcement of any warrants of eviction pursuant to landlord/tenant actions commenced in New York City Civil Court, Richmond County, pending the resolution of the instant action. The only other named defendant in this action who has interposed an Answer is Eli S. Fixler, Esq. ("Defendant Fixler"). A preliminary conference has not yet been held in this matter.

All three motions have been fully briefed. Oral argument was heard on February 19, 2026 and the Court's decisions were reserved.

FACTUAL BACKGROUND

This action arises from a series of transactions involving the real property located at XX VXXXX Place in Staten Island, New York ("the property"). Plaintiffs purchased the property in 2005 and occupied it as their primary residence. After Plaintiffs fell behind on their mortgage payments, the lender commenced a foreclosure action in Supreme Court, Richmond County, under Index #135671/2017 ("the foreclosure action").

According to the Complaint, while the foreclosure action was pending, Plaintiffs were approached Sam Oknin ("Defendant Oknin"), another defendant in this action, and a non-party identified as Avram Simmons, also known as John Simmons, in June of 2019, who offered to assist them in obtaining a loan modification to save their home from foreclosure. Plaintiffs allege that they were induced to sign various documents which, unbeknownst to them, included a deed transferring ownership of the property to Maggid Ventures, LLC ("Defendant Maggid"), another defendant. Plaintiffs further allege that they paid approximately $142,000.00 over several years into an "escrow fund" purportedly earmarked for resolving the foreclosure action with the lender. Plaintiffs claim that, during this same period, they continued to pay the property's carrying charges, including taxes and water/sewer fees, and invested approximately $50,000.00 in improvements.

Plaintiffs further allege that some of the defendants, without specifying, moved a Section 8 tenant into an apartment at the property in April of 2020, and thereby collected over $65,000.00 in rental payments from the City of New York while Plaintiffs continued to pay the [*3]utilities for said tenant.

On or about October 1, 2023, a Residential Contract of Sale ("the contract") was prepared naming Defendant Satmar as purchaser of the property for $745,000.00. The contract included a Short Sale Rider ("the rider") making the transaction contingent upon the written approval of the foreclosing lender and incorporating cancellation, disclosure, and merger provisions. Plaintiffs allege they did not sign the contract or the rider, and assert that their signatures on the documents were forged.

It is undisputed that a short-sale closing occurred on or about December 21, 2023. Plaintiffs allege that at this closing, Defendant Maggid, which was represented by Leah Bloom ("Defendant Bloom"), another defendant, first executed a deed conveying the property back to Plaintiffs and, immediately thereafter, Plaintiffs were induced to execute a bargain and sale deed ("the deed") conveying the property to Defendant Satmar, which was represented by Defendant Weber. Plaintiffs allege that, at that closing, Defendant Rosenfield appeared and offered them $250,000.00 to vacate the property, which Plaintiffs declined.

To facilitate the purchase, Defendant Satmar obtained a loan from Defendant YJV in the principal amount of $558,000.00 (the "the YJV Mortgage"). The YJV Mortgage proceeds were wired to the escrow account of Defendant Fixler and then remitted to the loan servicer for Plaintiffs' existing mortgage, satisfying the prior lien. On January 26, 2024, counsel for the lender in the foreclosure action submitted an affirmation stating that the loan had been paid in full, and seeking vacatur of the judgment of foreclosure and discontinuance of the foreclosure action.

Plaintiffs allege that they were told the transactions executed at the closing on December 21, 2023 were part of a process to save their home and rehabilitate their credit and that, after a period of time, the property would be conveyed back to them. Plaintiffs remained in possession of the property after the closing. On or about February 19, 2025, Defendant Satmar, as "Landlord", and Defendant Rosenfield, as "Managing Member" of Defendant Satmar, served Plaintiffs with a 90-day notice to quit. According to the Complaint, Defendant Satmar has since transferred the property to Defendant 63NY.

On April 30, 2025, Plaintiffs commenced this action by filing a Summons, with a Verified Complaint and Notice of Pendency.

The Complaint asserts multiple causes of action against the defendants, including Defendant Satmar, Defendant YJV, and Defendant Taub, sounding in constructive trust, fraud, quiet title under RPAPL Article 15, fraud in the inducement, alleged violations of Real Property Law §§ 265-a and 265-b, conversion, piercing the corporate veil, and breach of fiduciary duty arising out of the alleged mortgage rescue scheme.

STANDARD OF REVIEW

On a motion to dismiss under CPLR 3211, courts give the pleading a liberal construction [*4]and accept the facts alleged in the complaint as true, affording the plaintiff the benefit of every possible favorable inference (Leon v Martinez, 84 NY2d 83, 87-88 [1994]). The court's role at this stage is only to determine whether the facts as alleged fit within any cognizable legal theory (Guggenheimer v Ginzburg, 43 NY2d 268, 275 [1977]; Rovello v Orofino Realty Co., Inc., 40 NY2d 633, 634 [1976]).

Dismissal under CPLR 3211 (a) (1) is warranted only where documentary evidence utterly refutes the plaintiff's factual allegations and conclusively establishes a defense as a matter of law (Goshen v Mut. Life Ins. Co. of New York, 98 NY2d 314, 326 [2002]). To qualify as "documentary", evidence must be unambiguous, of undisputed authenticity, and "essentially undeniable", such as judicial records and documents reflecting out-of-court transactions, including mortgages, deeds, and contracts (see Fontanetta v Doe, 73 AD3d 78, 84-87 [2d Dept 2010]). Dismissal on this ground is therefore reserved for those cases in which such proof, assuming the validity of its execution, utterly refutes the version of events pleaded (see Goshen, 98 NY2d at 326).

Where a CPLR 3211(a) (3) motion is based upon an alleged lack of standing, the burden is on the moving defendant to establish, prima facie, the plaintiff's lack of standing as a matter of law (Wilmington Sav. Fund Socy., FSB v Matamoro, 200 AD3d 79, 90 [2d Dept 2021]). To defeat a defendant's motion to dismiss, the plaintiff has no burden to establish its standing, but to merely raise a question of fact as to the issue (id.).

Under CPLR 3211 (a) (7), the motion to dismiss must be denied if, from the four corners of the complaint and any affidavits submitted in opposition, factual allegations can be discerned which, taken together, manifest any cause of action cognizable at law (511 W. 232nd Owners Corp. v Jennifer Realty Co., 98 NY2d 144, 152 [2002]; Guggenheimer, 43 NY2d at 274-275). Bare legal conclusions are not presumed true, and allegations that are vague, speculative, or flatly contradicted by documentary evidence are not entitled to favorable inferences (Simkin v Blank, 19 NY3d 46, 52 [2012]; Breytman v Olinville Realty, LLC, 54 AD3d 703, 703-704 [2d Dept 2008]). In opposing a CPLR 3211 (a) (7) motion, a plaintiff may submit affidavits to supplement and amplify the pleadings and to preserve claims that are potentially meritorious, though inartfully pleaded (see Rovello, 40 NY2d at 635-636).

Where claims sound in fraud, CPLR 3016 (b) requires that "the circumstances constituting the wrong shall be stated in detail," but that requirement is not applied so rigidly as to bar otherwise valid claims where the operative facts are peculiarly within the defendants' knowledge (see Pludeman v N. Leasing Sys., Inc., 10 NY3d 486, 491-492 [2008]; Lanzi v Brooks, 43 NY2d 778, 780 [1977]; Jered Contr. Corp. v New York City Tr. Auth., 22 NY2d 187, 194 [1968]). It is sufficient that the allegations provide notice of the transactions or series of transactions complained of and set forth facts from which a reasonable inference of fraudulent conduct may be drawn (see Pludeman, 10 NY3d at 491-494).

DISCUSSION

I. Defendant Satmar/Defendant Rosenfeld/Defendant Weber/Defendant 63NY's Motion (#2) to [*5]Dismiss

(a) Constructive Trust (First Cause of Action) and RPAPL Article 15 (Sixth Cause of Action)

Within Motion #2, the movants argue that Plaintiffs' equitable and property-based claims must be dismissed because Plaintiffs lack a cognizable legal or equitable ownership interest in the property. They further argue that the delivery and recording of the deed on December 21, 2023 divested Plaintiffs of title as a matter of law. In response to Plaintiffs' allegations attacking the authenticity of the contract and the rider, the movants maintain that such claims are secondary to the dispositive effect of the deed. Specifically, the movants point to Plaintiffs' own affidavits of merit wherein Plaintiffs admit that, on December 21, 2023, they attended a closing and executed the deed conveying the property to Defendant Satmar.

The movants argue that, because Plaintiffs signed the deed, the instrument is at most voidable rather than void ab initio, even if allegedly procured by misrepresentation or duress. Consequently, the movants maintain that Plaintiffs lack standing to seek a constructive trust remedy, or to quiet title, because they voluntarily relinquished their interest in the property. They further argue that any alleged promises of reconveyance of title to Plaintiffs were oral statements attributable only to the non-moving co-defendants, and cannot form the basis of an equitable claim against the movants.

In opposition, Plaintiffs argue that the documentary evidence relied upon, specifically the contract and the rider, are fraudulent. They submit a flight itinerary asserting they were returning from Florida on the date that those documents were purportedly executed, and further claim that the subsequent deed was obtained by false pretenses and coercion, rendering it void ab initio. With respect to standing, Plaintiffs argue that a constructive trust claim does not require an immediate ownership interest, but rather a transfer in reliance on a confidential promise, and that their actual possession of the property satisfies the requirements of RPAPL Article 15.

A constructive trust is an equitable remedy and may be imposed when property has been acquired in such circumstances that the holder of the legal title may not in good conscience retain the beneficial interest (Sharp v Kosmalski, 40 NY2d 119, 121 [1976]; Rowe v Kingston, 94 AD3d 852, 853 [2d Dept 2012]). The elements of a cause of action for a constructive trust are (1) the existence of a confidential or fiduciary relationship, (2) a promise, (3) a transfer in reliance thereon, and (4) unjust enrichment (see Sharp, 40 NY2d at 121; Mazzei v Kyriacou, 139 AD3d 823, 824 [2d Dept 2016]). These elements, however, serve only as a guideline and a constructive trust may still be imposed even if all the elements are not established (Quadrozzi v Estate of Quadrozzi, 99 AD3d 688, 691 [2d Dept 2012]). The principal aim of the constructive trust remedy is to prevent unjust enrichment (see Sharp, 40 NY2d at 123).

The Court finds that the contract and rider do not utterly refute Plaintiffs' claims under CPLR 3211 (a) (1). While documents reflecting out-of-court transactions such as contracts and deeds may qualify as documentary evidence where their contents are essentially undeniable, [*6]such evidence must be of undisputed authenticity and essentially unassailable to support dismissal at the pleading stage (see Sobel v Ansanelli, 98 AD3d 1020, 1021-1022 [2d Dept 2012]; see also Fontanetta, 73 AD3d at 84—87; McDonald v O'Connor, 189 AD3d 1208, 1210 [2d Dept 2020]). Here, Plaintiffs' allegations of forgery, supported by their affidavits and the copy of their flight itinerary, directly challenge the authenticity of the contract and rider. In light of Plaintiffs' allegations, neither the contract nor the rider conclusively establish a defense as a matter of law, and dismissal under CPLR 3211 (a) (1) is not warranted (see Goshen, 98 NY2d at 326; see also Sobel, 98 AD3d at 1021-1022).

With respect to CPLR 3211 (a) (3), the Court finds that the movants have failed to establish, prima facie, Plaintiffs' lack of standing as a matter of law. Although the movants argue that Plaintiffs' execution of the deed divested them of standing, the Complaint and affidavits of merit raise a question of fact as to whether that transfer was a product of a mortgage rescue scheme rather than a bona fide, arm's length sale. Because the very basis of this action is that Plaintiffs were induced to transfer title while retaining an equitable interest in their primary residence, the movants cannot rely upon the challenged instruments to establish a lack of standing at this stage of the litigation (see U.S. Bank N.A. v Trulli, 179 AD3d 740, 742 [2d Dept 2020]; see also Lucia v Goldman, 68 AD3d 1064, 1066 [2d Dept 2009]).

The Court finds that the Complaint and supporting affidavits adequately state causes of action for both constructive trust and quiet title. As to constructive trust, Plaintiffs allege a coordinated mortgage rescue scheme involving the movants, including their role in orchestrating and closing the short-sale transaction, acquiring title, immediately participating in downstream assignments of leases and rents to Defendant YJV, and seeking to evict Plaintiffs from the property, all against the backdrop of assurances that Plaintiffs would be able to remain in their home and eventually reclaim ownership. These allegations of active participation in the transactional chain, facilitated by the legal advice and representations of Defendant Fixler, sufficiently plead the elements of a constructive trust remedy, which may be imposed even where every element is not technically satisfied (see Sharp, 40 NY2d at 121; Quadrozzi, 99 AD3d at 691; Rowe, 94 AD3d at 853).

Similarly, the quiet title claim under RPAPL Article 15 is sustained by allegations that the movants' title was acquired pursuant to a deed and underlying contract that Plaintiffs allege are fraudulent and void ab initio, while Plaintiffs remain in actual possession of the property (see RPAPL 1515; Acocella v Bank of NY Mellon, 127 AD3d 891, 892—893 [2d Dept 2015]; Acocella v Wells Fargo Bank, NA, 139 AD3d 647, 649 [2d Dept 2016]). Accepting these allegations as true and affording Plaintiffs the benefit of every favorable inference, the Court cannot conclude, at this preliminary stage, that no cognizable claim to an equitable or possessory interest in the property exists.

Accordingly, those branches of Motion #2 seeking to dismiss the first and sixth causes of action will be denied.

(b) Fraud (Second Cause of Action), Fraud in the Inducement (Fourth Cause of Action), and Breach of Fiduciary Duty (Ninth Cause of Action)

The movants argue that the fraud allegations set forth in the Complaint are fatally deficient under the heightened pleading standards of CPLR 3016 (b) because Plaintiffs' rely on vague and generalized oral promises purportedly made by others, rather than specific misrepresentations made by the movants. They contend that Plaintiffs have failed, in their Complaint and opposition papers, to identify any material misstatement actually made by the movants, and note that an offer to pay Plaintiffs to vacate the premises does not constitute a fraudulent misrepresentation.

The movants further argue that these claims are barred by the merger clause and specific non-reliance provisions contained in the contract. Specifically, they assert that Plaintiffs' express written disclaimer of any side agreements or promises outside the contract renders any alleged reliance on extrinsic oral representations, such as the purported promises regarding reconveyance or credit rehabilitation, unreasonable as a matter of law.

Regarding the fiduciary duty claim, the movants argue they acted as mere counterparties in a commercial transaction, and shared no confidential or fiduciary relationship with Plaintiffs, who instead allege they placed their trust in the non-moving co-defendants, including Defendant Fixler and Defendant Oknin.

Plaintiffs contend that the heightened pleading standards of CPLR 3016 (b) are met by their detailed allegations regarding the coordinated mortgage rescue scheme. They argue that a confidential relationship was established because they were induced to place their trust in a group that included an attorney and a purported religious leader, and that the movants joined and benefitted from this scheme. Plaintiffs further argue that the merger and non-reliance clauses are unenforceable because they did not sign the contract or the rider, and that their signatures on those documents were forged. According to Plaintiffs, all of the transactions that the movants point to, as related to the property, were fraudulent.

To state a cause of action sounding in fraud, a plaintiff must allege that (1) the defendant made a representation or a material omission of fact which was false and the defendant knew to be false, (2) the misrepresentation was made for the purpose of inducing the plaintiff to rely upon it, (3) there was justifiable reliance on the misrepresentation or material omission, and (4) injury (see Caravello v One Mgt. Group, LLC, 131 AD3d 1191, 1192-1193 [2d Dept 2015]; Lama Holding Co. v Smith Barney Inc., 88 NY2d 413, 421 [1996]). Where the fraud is utilized to challenge the validity of an agreement, it is characterized as fraud in the inducement (see Brown v Lockwood, 76 AD2d 721, 738-739 [2d Dept 1980]; see also Gosmile, Inc. v Levine, 81 AD3d 77, 81-82 [1st Dept 2010]). Under CPLR 3016 (b), the circumstances constituting the wrong must be stated in detail, but this requirement does not impose an unassailable proof standard (see Pludeman, 10 NY3d at 491-492). A pleading is sufficient if it provides enough detail to inform a defendant of the substance of the claims (see id.).

Furthermore, the pleading requirements of CPLR 3016 (b) should not be interpreted so strictly as to require specificity where it may be impossible to state in detail the circumstances constituting a fraud, particularly where the relevant facts are peculiarly within the knowledge of the defendants (see id.; Lanzi, 43 NY2d at 780; Jered Contr. Corp., 22 NY2d at 194). In such [*7]cases, the requirement of particularity may be met when the facts alleged are sufficient to permit a reasonable inference of the fraudulent conduct (see id.; Polonetsky v Better Homes Depot, Inc., 97 NY2d 46, 55 [2001]).

A fiduciary relationship exists when one party is "under a duty to act for or to give advice for the benefit of another upon matters within the scope of the relation" (see Eurycleia Partners, LP v Seward & Kissel, LLP, 12 NY3d 553, 561 [2009], citing EBC I, Inc. v Goldman, Sachs & Co., 5 NY3d 11 [2005]). In other words, a fiduciary duty exists when "confidence is reposed on one side and there is resulting superiority and influence on the other" (AG Capital Funding Partners, L.P. v State St. Bank and Tr. Co., 11 NY3d 146, 158 [2008]). It is well-established that determining the existence of a fiduciary relationship inevitably requires a fact-specific inquiry (see Eurycleia Partners, LP, 12 NY3d at 561).

A claim for breach of fiduciary duty requires the existence of a fiduciary relationship, misconduct by the defendant, and damages directly caused by that misconduct (see Litvinoff v Wright, 150 AD3d 714, 715 [2d Dept 2017]). In the context of a coordinated scheme, a non-fiduciary who knowingly induces or participates in a breach of duty may be held liable for the resulting damages (see Smallberg v Raich Ende Malter & Co., LLP, 140 AD3d 942, 944 [2d Dept 2016]).

The Court finds that Plaintiffs' allegations regarding the double transfer structure employed at the closing, which they characterize in their papers as a "three card shuffle", are sufficient to call into question the nature and circumstances of the transaction. Plaintiffs allege that title moved from Defendant Maggid back to Plaintiffs, and then immediately from Plaintiffs to Defendant Satmar, while Plaintiffs remained in continuous possession of the property. Because the operative details concerning the movants' knowledge, intent, and the representations at issue are peculiarly within their possession, dismissal for lack of specificity under CPLR 3016 (b) is inappropriate, as it would prematurely foreclose discovery into those matters (see Pludeman, 10 NY3d at 491-493; Hansen v Burton, 14 Misc 3d 1210[A] [Sup Ct, Richmond County 2006]).

As aforementioned, Plaintiffs' allegations of forgery and a mortgage rescue scheme challenge the validity of the underlying instruments. Consequently, the movants cannot rely on merger or non reliance clauses within those disputed documents to bar claims of fraud at this stage of the litigation (see Sobel, 98 AD3d at 1021-1022; see also Lucia, 68 AD3d at 1066).

The Court further finds that the Complaint adequately describes a coordinated scheme facilitated by the legal advice of Defendant Fixler, in which the movants played an integrated role by acquiring title, assigning leases and rents, seeking to evict Plaintiffs, and transferring title to another entity, Defendant 63NY. These allegations of active participation in a transactional chain, which Plaintiffs allege was designed to strip them of their equity, permit a reasonable inference of the movants' knowledge of, or participation in, the fraudulent scheme (see Pludeman, 10 NY3d at 492; Polonetsky, 97 NY2d at 55; Ramirez v Donado Law Firm, P.C., 169 AD3d 940, 942-943 [2d Dept 2019]). Whether Plaintiffs' reliance on the representations made during this process was justifiable is a question of fact that cannot be resolved on a motion to dismiss (see Braddock v Braddock, 60 AD3d 84, 88 [1st Dept 2009]).

Accordingly, those branches of Motion #2 seeking to dismiss the second, fourth, and ninth causes of action will be denied.

(c) Real Property Law §§ 265-a and 265-b (Third Cause of Action)

The movants argue that the Home Equity Theft Prevention Act (HETPA), codified under Real Property Law § 265-a, is inapplicable to this lender-approved short-sale. They contend that Plaintiffs' effort to void the deed is unsupported by law because they willingly executed the transfer and acknowledged they were relinquishing all ownership rights.

Regarding Real Property Law § 265-b, which regulates distressed property consultant contracts, the movants argue that they acted as purchasers in an arm's length commercial transaction, and not as consultants. They maintain that these statutes do not protect sellers like Plaintiffs who simply wish to renege on a valid contract after accepting the benefits of a short sale.

In their reply papers, the movants maintain that Plaintiffs failed to produce a contract or written agreement providing for a right of reconveyance, and that the express terms of the contract and the rider bar any legal reliance on inconsistent oral assurances.

Finally, the movants argue that, even if Real Property Law §§ 265-a or 265-b apply, Plaintiffs ratified the transaction by accepting its benefits and waiting over one year before seeking rescission.

In opposition, Plaintiffs argue that the transaction is governed by Real Property Law §§ 265-a and 265-b because the property was their primary residence and was the subject of an active foreclosure proceeding. They argue the movants acted as consultants who failed to provide the mandatory right of rescission. Plaintiffs reject the ratification argument, asserting that a deed obtained through the fraudulent scheme described in the Complaint is void as a matter of law, and cannot be ratified.

HETPA is a remedial statute enacted to curb mortgage rescue schemes, and its provisions should be liberally construed in favor of equity sellers (Real Property Law § 265-a; see Lucia, 68 AD3d at 1066, citing Matter of DaimlerChrysler Corp. v Spitzer, 7 NY3d 653, 660 [2006]). Real Property Law § 265-b governs the conduct of "distressed property consultants" defined as entities that directly or indirectly undertake employment, for compensation or the promise of compensation, to provide consulting services to a homeowner with respect to a distressed home loan or a potential loss of the home for non-payment of taxes (Real Property Law § 265-b [1] [e]). Allegations that defendants held themselves out as saving a homeowner's primary residence from foreclosure, while operating outside the ordinary provision of legal services, may suffice at the pleading stage to state a claim under this statute (see Ramirez, 169 AD3d at 941; De Guaman v American Hope Group, 163 AD3d 915, 916 [2d Dept 2018]).

As set forth above, Plaintiffs allege that the property was their primary residence, that it was subject to an active foreclosure action, and that they were drawn into a mortgage rescue [*8]scheme based on representations that title would transfer, their mortgage debt would be satisfied through a short-sale, and the property would ultimately be reconveyed to them. They further allege that the movants participated in this arrangement by taking title through the double transfer closing structure and assigning leases and rents, without providing a HETPA compliant written agreement or notice of rescission, while Plaintiffs remained in possession and continued to make payments in reliance on the promise that their home would be saved.

Accepting those allegations as true, the Court cannot, at this juncture, adopt the movants' characterization of the transaction as a straightforward lender approved short-sale falling outside Real Property Law §§ 265-a and 265-b. The remedial purpose of HETPA and the pleaded facts concerning a coordinated mortgage rescue scheme, involving Plaintiffs' primary residence and the claim of an ongoing promise of reconveyance, are sufficient to bring the third cause of action within a cognizable statutory framework at the pleading stage (see Lucia, 68 AD3d at 1066; Ramirez, 169 AD3d at 940-941; De Guaman, 163 AD3d at 916-917).

The movants' reliance on the absence of a written agreement, and on the non reliance clauses of the contract and the rider, similarly does not warrant dismissal. Plaintiffs allege that the instruments on which the movants rely were themselves procured as part of the fraudulent mortgage rescue scheme, including the alleged forgery of the contract and the rider, as described in the Complaint, and the Court has already determined that the allegations of fraud are sufficient, if proven, to undermine the validity of those instruments. In that posture, the documentary evidence does not "utterly refute" Plaintiffs' factual allegations or conclusively establish a defense as a matter of law (see Lucia, 68 AD3d at 1065—1066; Goshen, 98 NY2d at 326).

For the same reasons, the Court declines to dismiss the Real Property Law §§ 265-a and 265-b claims on the basis of ratification of the underlying instruments. Plaintiffs' allegations, if credited, describe a transaction structured and executed in violation of HETPA, and a deed obtained through such a scheme is, at a minimum, not so clearly ratifiable on the present record as to defeat the statute based claims as a matter of law (see Lucia, 68 AD3d at 1066).

Accordingly, the branch of Motion #2 seeking dismissal of the third cause of action will be denied.

(d) Conversion (Fifth Cause of Action)

The movants do not independently address the elements of conversion, but instead challenge the claim within the broader context of their standing and title arguments. They argue that the cause of action is refuted by documentary evidence, specifically the deed and closing documents. The movants contend that, because Plaintiffs attended the closing and voluntarily executed the deed, the subsequent transfer of the property was an authorized exercise of dominion that precludes a claim for conversion as a matter of law.

Plaintiffs argue they have stated a viable claim for conversion by alleging that the movants, in concert, misappropriated approximately $142,000.00 in purported escrow fund [*9]payments, and $65,000.00 in Section 8 rent. They further argue that these were specific, identifiable funds paid under the false pretense of saving their home and were never applied to the intended purpose.

A conversion occurs when someone intentionally and without authority assumes or exercises control over personal property belonging to another, interfering with that person's right of possession (see Colavito v New York Organ Donor Network, Inc., 8 NY3d 43, 49-50 [2006]). Money, if specifically identifiable, may be the subject of a conversion claim, but such a claim must allege legal ownership or an immediate right of possession to specifically identifiable funds and unauthorized dominion over those funds to the exclusion of the plaintiff's rights (see Abraham v Torati, 219 AD3d 1275, 1282 [2d Dept 2023]; Scifo v Taibi, 198 AD3d 704, 706 [2d Dept 2021]; Daub v Future Tech Enter., Inc., 65 AD3d 1004, 1006 [2d Dept 2009]). By contrast, identifiable funds held in a specific account and withdrawn without authority may support a conversion claim (see Payne v White, 101 AD2d 975, 978 [3d Dept 1984]).

Here, although the Complaint and affidavit of merit identify the escrow payments and rental proceeds as specific sums allegedly diverted from their intended purpose, Plaintiffs attribute the representations concerning the collection and handling of those monies either to non moving co-defendants or to the defendants, collectively, during a period that predated the short-sale and transfer of title to Defendant Satmar. The pleadings do not set forth non conclusory allegations that the movants, themselves, ever received those specific funds or exercised control over them, and while such collective allegations may suffice for a fraud-based claim at this stage, they are insufficient to establish the specific exercise of dominion required for conversion. Thus, even accepting Plaintiffs' allegations as true and affording them every favorable inference, the fifth cause of action does not adequately allege that the movants exercised unauthorized dominion over specifically identifiable funds to the exclusion of Plaintiffs' rights, as required to state a claim for conversion (see Abraham, 219 AD3d at 1282-1283; Scifo, 198 AD3d at 706; Daub, 65 AD3d at 1006).

To the extent the conversion claim is premised on the execution and delivery of the deed and related closing documents, it merely restates Plaintiffs' challenges to title and the contractual and equitable arrangements surrounding the closing, which are properly addressed through their fraud, constructive trust, and quiet title claims, and does not allege a separate wrongful exercise of dominion over personal property or specific funds cognizable as conversion (see Fiorenti v Cent. Emergency Physicians, PLLC, 305 AD2d 453, 455 [2d Dept 2003], citing Indep. Discount Corp. v Bressner, 47 AD2d 756 [2d Dept 1975]).

Accordingly, the branch of Motion #2 seeking to dismiss the fifth cause of action will be granted, and the conversion claim will be dismissed.

(e) Piercing the Corporate Veil (Seventh Cause of Action)

Regarding the claim for piercing the corporate veil, the movants argue by extension that, since the primary causes of action are refuted by documentary evidence and fail to state a claim, there is no underlying wrong or fraud upon which to base such a remedy. They contend that [*10]Plaintiffs' reliance on affidavits concerning unrelated litigation involving different properties and parties is irrelevant and fails to establish any specific wrongdoing by the movants toward these Plaintiffs.

Plaintiffs argue that dismissal is premature, as the Complaint adequately alleges that the individual defendants used various corporate entities as alter egos to shield themselves from liability. They point to the close ties between the principals of the various entities as evidence of a unity of interest that warrants further discovery.

Generally, courts will disregard the corporate form, or "pierce the corporate veil", whenever necessary to prevent fraud or to achieve equity (see HLI Rail & Rigging, LLC v Franklin Exhibit Mgt. Group, LLC, 237 AD3d 1071, 1072-1073 [2d Dept 2025]). The doctrine of piercing the corporate veil is equitable in nature and is not an independent cause of action, but rather an assertion of facts and circumstances that would justify imposing a corporate obligation on its owners (see Matter of Morris v New York State Dept. of Taxation and Fin., 82 NY2d 135, 140-141 [1993]). A party seeking to pierce the corporate veil must show that the owners exercised complete domination of the corporation with respect to the transaction attacked, and that such domination was used to commit a fraud or wrong against the plaintiff which resulted in injury (see Morris, 82 NY2d at 141-142). The mere claim that the corporation was completely dominated by the defendants, or conclusory assertions that the corporation acted as their alter ego, without more, will not suffice to support the equitable relief of piercing the corporate veil (Damianos Realty Group, LLC v Fracchia, 35 AD3d 344, 344-345 [2d Dept 2006]).

Here, the Court has already determined that Plaintiffs have stated viable substantive claims sounding in fraud, constructive trust, HETPA, and to quiet title against the movants, such that the absence of an underlying wrong does not, at this juncture, furnish a basis to reject veil piercing altogether. Although a cause of action under the doctrine of piercing the corporate veil is not required to meet a heightened level of particularity, and a fact-laden claim to pierce the corporate veil is often unsuited for resolution on a pre-discovery motion to dismiss, Plaintiffs' seventh cause of action, as pleaded here, does little more than allege in conclusory terms that the defendants exercised complete dominion and control over the named entities (see HLI Rail & Rigging, LLC, 237 AD3d at 1073).

Upon review, the Court finds that the pleadings fail to particularize the respects in which the corporate form of any specific entity was abused in connection with the challenged transactions, or how any such domination by the movants was used to commit a distinct fraud or wrong beyond the conduct already alleged in support of the substantive claims (see Damianos Realty Group, LLC, 35 AD3d at 344-345). In other words, the veil piercing allegations add no independent factual content beyond the underlying causes of action and are more appropriately treated, if necessary, as an equitable basis for imposing any corporate liability on individual owners in the event Plaintiffs ultimately prevail (see Morris, 82 NY2d 135).

Accordingly, the branch of the motion seeking dismissal of the seventh cause of action, to pierce the corporate veil, will be granted. That claim will be dismissed without prejudice to Plaintiffs' ability, in the event of a favorable judgment on their substantive claims, to seek [*11]appropriate equitable relief concerning the corporate form.

II. Defendant YJV's Motion (#3) to Dismiss

Defendant YJV moves to dismiss the complaint pursuant to CPLR 3211(a) (1) and (7), arguing that it served solely as a source of financing for Defendant Satmar in connection with the December 2023 closing, that its loan proceeds were used to satisfy Plaintiffs' prior mortgage in the foreclosure action, and that it assigned its mortgage to a non-party, identified as "Elco Capital, LLC", before this action was commenced. Therefore, according to Defendant YJV, it no longer held any interest in the property or the mortgage at the time Plaintiffs commenced this action. Defendant YJV further argues that the Complaint alleges no specific wrongdoing by Defendant YJV itself and that, even if the deed were void, any resulting issue would concern the validity or enforceability of the mortgage lien and would not, standing alone, provide an independent basis for tort or equitable liability against Defendant YJV.

In opposition, Plaintiffs maintain that all defendants acted in concert as part of a mortgage rescue scheme, and that the deed and related closing documents are void ab initio. Plaintiffs therefore argue that, because the deed is allegedly void, the YJV mortgage predicated upon that deed is likewise void, and that Defendant YJV's funding of the transaction permits an inference that it was part of the overall scheme. Plaintiffs further argue that Defendant YJV remains a proper party because its purported assignment of the mortgage was not recorded until after the filing of the Notice of Pendency.

On this record, the Court finds that dismissal of the Complaint, insofar as asserted against Defendant YJV, is warranted.

The Court finds that Plaintiffs' fraud-based theories, including common law fraud, fraud in the inducement, and statutory claims sounding in fraud, are not adequately pleaded as to Defendant YJV. Fraud must be alleged with particularity as against each defendant, identifying specific misrepresentations or omissions, knowledge, intent, reliance, and injury, and this requirement is applied strictly where liability is sought to be extended beyond the primary actors to a peripheral participant in an alleged scheme (see Grasso v Guarino, 227 AD3d 872, 873-874 [2d Dept 2024]; see also High Tides LLC v DeMichele, 88 AD3d 954, 957-959 [2d Dept 2011]; 125 Assoc. v Cralin Trading Assoc., L.P., 196 AD2d 630, 630-631 [2d Dept 1993]; Natl Westminster Bank USA v Weksel, 124 AD2d 144, 149 [1st Dept 1987]; see also CPLR 3016 [b]). Here, the detailed allegations that support partial denial of Motion #2, including the role of Defendant Satmar as purchaser under the disputed short-sale contract and as record titleholder following the closing, are not mirrored as to Defendant YJV. The complaint alleges only that Defendant YJV funded the transaction as a lender which, on its own, is insufficient to state a cognizable claim for fraud (see High Tides, 88 AD3d at 958-959).

For similar reasons, the Court finds that Plaintiffs fail to state any equitable or fiduciary claims against Defendant YJV. A constructive trust and a claim for breach of fiduciary duty require, at a minimum, a confidential or fiduciary relationship, a promise, a transfer in reliance, and unjust enrichment, and courts do not infer such a relationship from an arm's length lending [*12]transaction (see Sharp, 40 NY2d at 121-123; see also Fischer v Sadov Realty Corp., 34 AD3d 630, 631 [2d Dept 2006]; Karan v Hoskins, 22 AD3d 638, 638-639 [2d Dept 2005]; LaSalle Bank Nat. Assn v Ally, 39 AD3d 597, 599-600 [2d Dept 2007]; River Glen Assoc., Ltd. v Merrill Lynch Credit Corp., 295 AD2d 274, 275 [1st Dept 2002]). The pleadings only allege that Defendant YJV extended a loan to Defendant Satmar, secured by the property. On these facts, the constructive trust and fiduciary duty theories cannot be maintained against Defendant YJV.

Furthermore, the documentary evidence submitted by Defendant YJV conclusively refutes Plaintiffs' equitable claims. The undisputed documents demonstrate that the proceeds of Defendant YJV's loan were used to satisfy Plaintiffs' prior mortgage in full, resulting in the discontinuance of the foreclosure action. Under the doctrine of equitable subrogation, a lender whose funds discharge an existing mortgage is ordinarily subrogated to the rights of the prior mortgagee, even if the new mortgage is later challenged, so as to prevent an unwarranted windfall to the borrower (see King v Pelkofski, 20 NY2d 326, 333-334 [1967]; LaSalle Bank Natl. Assn., 39 AD3d at 599-600; Fed. Natl. Mtge. Assn. v Woodbury, 254 AD2d 182, 183 [1st Dept 1998]). Accordingly, Plaintiffs cannot establish their equitable relief claims against Defendant YJV. Similarly, the record is devoid of allegations sufficient to support a claim for conversion against the lender (see Colavito, 8 NY3d at 49-50; see also Fiorenti, 305 AD2d at 455).

Plaintiffs' contention that the deed was void ab initio, even if assumed true at this stage, does not alter the Court's analysis of the tort and fiduciary claims asserted against Defendant YJV. Even if a deed is void ab initio due to fraud, a lender is not thereby liable for the underlying fraud, and remains entitled to equitable subrogation where its funds were used to satisfy a prior valid mortgage (see LaSalle Bank Natl. Assn., 39 AD3d at 599-600; Lucia v Goldman, 145 AD3d 767 [2d Dept 2016]; Harris v Thompson, 117 AD3d 791, 793-794 [2d Dept 2014]). The record here is devoid of any specific, non-conclusory allegations that Defendant YJV was on notice of, or participated in, the alleged fraudulent mortgage rescue scheme (cf. LaSalle Bank Natl. Assn., 39 AD3d at 599-600). Plaintiffs' theory that a void deed automatically renders the transaction actionable for damages against the payoff lender is unsupported, as such a result would frustrate the fundamental purpose of equitable subrogation, which is to prevent a borrower from receiving an unwarranted windfall at the expense of a lender whose funds discharged a prior debt (see King, 20 NY2d at 333-334; LaSalle Bank Natl. Assn., 39 AD3d at 600).

For similar reasons as set forth above with respect to veil piercing, title-based claims, and the claim for breach of fiduciary duty, the Court finds that Plaintiffs have failed to allege facts that would justify piercing the corporate veil as to Defendant YJV, to state a claim against it under RPAPL Article 15 or other title-based or lien-based theories, or to impose any independent fiduciary or professional duty on Defendant YJV as the short-sale lender.

Therefore, the Court need not resolve the parties' dispute regarding the recording timeline of Defendant YJV's assignment of the mortgage. Even assuming, arguendo, that Defendant YJV was a proper party at the time this action was commenced, dismissal is independently warranted because the underlying causes of action are insufficiently pleaded as asserted against Defendant [*13]YJV.

Accordingly, Defendant YJV's motion seeking dismissal of the complaint pursuant to CPLR 3211 (a) (1) and (7) will be granted in its entirety.

III. Defendant Taub's Motion (#4) to Dismiss

Defendant Taub moves to dismiss the complaint pursuant to CPLR 3211 (a) (1) and (7), or, in the alternative, seeks summary judgment pursuant to CPLR 3212. He argues that the Complaint fails to allege specific wrongful conduct on his part, or facts showing that he possessed knowledge of, or participated in, the alleged fraudulent scheme, and that the pleadings provide no basis to hold him liable for the conduct of the other defendants.

Defendant Taub further argues that New York does not recognize an independent cause of action for conspiracy, and that Plaintiffs have failed to plead the necessary elements of any joint venture. He characterizes as vague and conclusory the allegation that he knows someone "inside" Plaintiffs' prior mortgage servicer, and relies on a short sale approval letter to demonstrate that he was not the party who initiated the short sale request. Defendant Taub also joins in his co defendants' arguments that the remaining claims fail for lack of particularity, the absence of a confidential relationship, and the inapplicability of title based, conversion, and fiduciary duty theories regarding his role as a broker.

In opposition, Plaintiffs argue that Defendant Taub was an active participant in the alleged scheme rather than an innocent bystander. They point to the HUD 1 settlement statement, which reflects that "Allied Real Estate" received $44,700.00 in broker's commissions in connection with the short sale of the property, submit evidence purported to show that Defendant Taub is affiliated with Allied Real Estate, and maintain that they never executed a broker or listing agreement retaining Defendant Taub or any entity to sell the property.

Plaintiffs further argue that Defendant Taub solicited the lender and induced the short sale transaction, and that all defendants acted in concert to defraud Plaintiffs of their equity in the property. According to Plaintiffs, the Complaint must be liberally construed at this pre discovery stage and summary judgment is premature, particularly because Defendant Taub did not submit an affidavit from a person with first hand knowledge of the underlying facts.

Applying the same standards set forth above, pursuant to CPLR 3211 (a) (7) and CPLR 3016 (b), the Court concludes that the pleadings against Defendant Taub are thin, but not entirely conclusory. Fraud-based claims must be pleaded with sufficient particularity to permit a reasonable inference of the alleged misconduct, but the statute is not so strictly applied as to defeat an otherwise viable claim where the details of a complex scheme remain largely within the defendants' knowledge (see Pludeman, 10 NY3d at 491-493; Am. Premium Realty Group, LLC v 37-19 Realty, Inc., 243 AD3d 746, 749-750 [2d Dept 2025]). Unlike Defendant YJV, whose alleged role was limited to providing a loan for the short sale of the property, Defendant Taub is tied, however narrowly, to the short sale itself and to the broker's commission generated [*14]by it. At this pre-discovery stage, that distinction is sufficient, albeit barely, to permit the fraud-based claims to proceed against Defendant Taub (see Am. Premium Realty Group, LLC, 243 AD3d at 749-750). The Court notes that, in reply, Defendant Taub did not address or dispute Plaintiffs' evidence that he was affiliated with Allied Real Estate, or that Allied Real Estate received $44,700.00 in broker's commissions on the short-sale without ever being hired by Plaintiffs, which supports the Court's conclusion that dismissal at this pre discovery stage is not warranted.

Defendant Taub is correct that New York does not recognize civil conspiracy as a stand-alone cause of action (see B&H Flooring, LLC v Folger, 228 AD3d 809, 812 [2d Dept 2024]). However, a plaintiff may plead the existence of a conspiracy in order to connect the actions of individual defendants with an actionable, underlying tort and establish that those actions were part of a common scheme (see Palmieri v Perry, Van Etten, Rozanski & Primavera, LLP, 200 AD3d 785, 788 [2d Dept 2021]). Here, because the Court finds the fraud-based claims sufficiently pleaded at this stage as against Defendant Taub, the conspiracy allegations may be considered only in that limited sense, and not as an independent theory of liability (see Am. Premium Realty Group, LLC, 243 AD3d at 750; Palmieri, 200 AD3d at 788).

The Court likewise rejects Plaintiffs' attempt to recast the allegations as a joint venture. A joint venture requires, among other things, an agreement manifesting the intent to be associated as joint venturers, some degree of joint control, and a provision for the sharing of profits and losses (see Steinbeck v Gerosa, 4 NY2d 302, 317 [1958]; Gramercy Equities Corp. v Dumont, 72 NY2d 560, 564-565 [1988]; Tilden of New Jersey, Inc. v Regency Leasing Sys., Inc., 230 AD2d 784 [2d Dept 1996]). The Complaint does not allege that Defendant Taub shared profits and losses, exercised joint ownership or control over the property, or entered into any agreement to operate as a joint venturer with any other defendant. Thus, the joint venture theory cannot serve as an independent basis to sustain the underlying claims against Defendant Taub (see Gramercy Equities Corp., 72 NY2d at 565; Tilden, 230 AD2d at 784).

With respect to Plaintiffs' constructive trust claim, the Court finds dismissal is not warranted at this pre-discovery stage of litigation. Plaintiffs' allegations, though sparse, are sufficient at this point to support the inference that Defendant Taub, through the broker's commission paid in connection with the short sale of the property, may have been unjustly enriched at Plaintiffs' expense in the course of the alleged mortgage rescue scheme. While the traditional elements of a constructive trust include a confidential or fiduciary relationship, a promise, a transfer in reliance thereon, and unjust enrichment, these elements serve only as a guideline and a constructive trust may still be imposed even if all the elements are not established (see Quadrozzi, 99 AD3d at 691; Sharp, 40 NY2d at 121). The question of whether the equitable remedy of constructive trust is warranted, on the record as ultimately developed, is not appropriately resolved at the pleading stage.

By contrast, Plaintiffs' cause of action for conversion, to the extent it is premised on the alleged wrongful transfer or retention of title to the property, or the allegedly unauthorized payment of brokerage commissions, is legally insufficient for the reasons already stated herein and is dismissed as against Defendant Taub (see Fiorenti, 305 AD2d at 455; Scifo, 198 AD3d at [*15]706; Abraham, 219 AD3d at 1282).

With respect to the cause of action alleging violations of Real Property Law §§ 265-a (HETPA) and 265-b, the Court finds that Plaintiffs have not stated a claim against Defendant Taub. Real Property Law § 265-a applies to equity purchasers who acquire an ownership interest in the property, and Real Property Law § 265-b governs distressed property consultants who provide consulting services to homeowners with respect to distressed home loans (Real Property Law §§ 265-a [2] [e], 265-b [1] [e]; see Lucia, 68 AD3d at 1066 [2d Dept 2009]). The Complaint alleges only that Defendant Taub acted as a broker in connection with the short-sale and received commissions unauthorized by Plaintiffs, and does not allege that he acquired any ownership interest, entered into a contract as an equity purchaser, or provided consulting services within the meaning of these provisions. Accordingly, the third cause of action will be dismissed insofar as asserted against Defendant Taub.

For the reasons previously stated herein with respect to veil piercing and title-based claims, Plaintiffs have also failed to allege any facts that would justify piercing the corporate veil as to Defendant Taub, or to state a claim against him under RPAPL Article 15 or any other cause of action directed to ownership, title, or the mortgage on the property, as he is not alleged to be an owner of the property or holder of any lien.

In addition, any claim sounding in breach of fiduciary duty or professional duty is not viable as against Defendant Taub, given that Plaintiffs do not allege that Defendant Taub entered into a relationship of trust and confidence with them, undertook to represent them in any professional capacity, or owed them any duty beyond that alleged in connection with the fraud-based and equitable claims.

Accordingly, Defendant Taub's motion will be granted to the extent that Plaintiffs' third cause of action under Real Property Law §§ 265-a and 265-b, fifth cause of action for conversion, sixth cause of action under RPAPL Article 15, seventh cause of action to pierce the corporate veil, and ninth cause of action for breach of fiduciary duty will be dismissed insofar as asserted against Defendant Taub, and will be otherwise denied.

DECISION AND ORDER

For the foregoing reasons, Motion #2 is GRANTED to the extent that it is hereby:

ORDERED that Plaintiffs' fifth cause of action sounding in conversion, and seventh cause of action to pierce the corporate veil, as asserted against Defendant Satmar, Defendant Rosenfeld, Defendant Weber, and Defendant 63NY are dismissed; and it is further

ORDERED that the action shall proceed against Defendant Satmar, Defendant Rosenfeld, Defendant Weber, and Defendant 63NY with respect to all remaining claims.

Motion #3 is hereby GRANTED in its entirety, and it is hereby:

ORDERED that all of Plaintiffs' causes of action, as asserted against Defendant YJV, are dismissed.

Motion #4 is hereby GRANTED to the extent that it is hereby:

ORDERED that Plaintiffs' third cause of action pursuant to Real Property Law §§ 265-a and 265-b, fifth cause of action sounding in conversion, sixth cause of action under RPAPL Article 15, seventh cause of action to pierce the corporate veil, and ninth cause of action for breach of fiduciary duty, as asserted against Defendant Taub, are dismissed; and it is further

ORDERED that the action shall proceed against Defendant Taub with respect to all remaining claims.

Any items of relief sought by the motions that are not addressed herein shall be considered to have been denied.