Concord Dev. Co. LLC v. Amedore Concord, LLC, Index No. 5402/15 01/21/16 (Platkin, J.)

Preliminary Injunction; Breach of Contract; Disqualification of Counsel; CPLR 6301

By: Amanda Tersigni | Staff Writer

Plaintiff purchased a fifteen-acre parcel of land. Plaintiff and Defendant then agreed to jointly develop and market the land by forming a joint venture called Amedore Concord LLC (“Joint Venture”). Plaintiff and Defendant formed the Joint Venture three years later. Christopher Myers, from Plaintiff (“Myers”), and George Amedore, from Defendant (“Amedore”), were named managers. Later, Defendant removed Plaintiff from the management and affairs of the Joint Venture.

As a result, Plaintiff filed for declaratory judgment on the basis that Defendant unilaterally removed Myers and Defendant lacked the membership interests required to unilaterally remove Myers. Later, Plaintiff moved for a preliminary injunction to (1) restrain Defendants from selling, transferring, developing or altering the fifteen-acre parcel of land and (2) disqualify Defendants’ counsel on the basis that issues of confidentiality may be compromised.

The Court denied Plaintiff’s request for a preliminary injunction because Plaintiff could not prove all the elements under CPLR 6301. Pursuant to CPLR 6301, a movant must satisfy three elements to obtain a preliminary injunction: (1) a likelihood of ultimate success on the merits; (2) the prospect of irreparable harm in the absence of the requested injunctive relief; and (3) a balance of the equities tipping in favor of the movant.  First, the Court held that Plaintiff did not have any likelihood success on the merits. Here, pursuant to the agreement, the membership was determined by the proportion of capital contributed to the Joint Venture by its members. Additionally, the agreement stated that a manager may be removed without cause by the vote of at least a majority of the membership interests. The Court recognized that Defendant held a majority of the membership interest, and was, therefore, within its authority to unilaterally remove Plaintiff and subsequently fill that vacancy. Therefore, Plaintiff failed to establish a likelihood of success on the merits. As Plaintiff failed to prove the first element, the Court found it unnecessary to further determine whether the other elements were satisfied.

Second, the Court did not grant Plaintiff’s motion to disqualify because the motion was devoid in merit. A party seeking disqualification of its adversary’s lawyer must prove (1) the existence of a prior attorney-client relationship between the moving party and opposing counsel; (2) that the matters involved in both representations are substantially related; and (3) that the interests of the present client and former client are materially adverse. Here, the Court found that no attorney-client relationship existed between Defendant’s counsel and Myers, or the Joint Venture, thereby not satisfying the first element. In fact, Defendants’ counsel only represented Quantum Development Group (“QDG”) in an action to remove certain deed restrictions on a parcel of property unrelated to the instant action. This fact was pertinent to the second element, where the Court found was not met because Defendant’s counsel’s legal work for QDG was not substantially related to this instant action, the Joint Venture, or the fifteen-acre parcel in question. Further, no interests are materially adverse because there is no evidence illustrated that any confidential information was imparted to Defendant’s Counsel, or any such confidential information had any bearing on the instant action. Therefore, the Court denied Plaintiff’s motion to disqualify.

Concord Dev. Co. LLC v. Amedore Concord, LLC, Index No. 5402/15 01/21/16 (Platkin, J.).

 

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