- News & Publications
- Appellate Division Affirms Dismissal of Litigation Funding Abuse Suit Against Carter Ledyard Clients
Appellate Division Affirms Dismissal of Litigation Funding Abuse Suit Against Carter Ledyard Clients
On September 30, 2020, the Appellate Division, Second Department affirmed the dismissal of an action by several merchant cash advance (MCA) companies and their principals against Carter Ledyard’s clients Fox Capital Group Inc. and Commonwealth Merchant Advance Inc., and others, for allegedly providing third-party litigation funding to the plaintiffs’ customers to sue the plaintiffs.
The third-party litigations at issue were brought against the plaintiffs by their small business customers (merchants), who claimed that that the plaintiffs engaged in fraudulent conduct. In some cases, the merchants sought injunctions to prevent the plaintiffs from entering confessions of judgment.
The Appellate Division found that the plaintiffs’ failed to allege the essential elements of their primary claim for tortious interference with contract, such as identifying the relevant merchant contracts or how they were breached, explaining how the defendants induced the breaches or asserting that the contracts would not have been breached by the merchants absent the defendants’ alleged conduct. The Appellate Division also affirmed the dismissal of the plaintiffs’ other claims for tortious interference with prospective contract, abuse of process, prima facie tort and permanent injunction.
Carter Ledyard previously represented Fox and Commonwealth in the trial court, and obtained the dismissal decision as well as a decision denying the plaintiffs’ motion for a preliminary injunction, which sought to prohibit the defendants from providing funding to the merchants to sue the plaintiffs. Carter Ledyard attorneys Jacob H. Nemon and Jeffrey S. Boxer represented Fox and Commonwealth.
Despite the attention the New York Department of Financial Services (“DFS”) Cybersecurity Regulation attracted when it took effect in March 2017, the number of enforcement actions brought by DFS under the…
Carter Ledyard client Global SC Finance SRL recently completed a refinancing of an existing series of revolving asset backed notes, involving an extension of the maturity and increase in the aggregate principal amount to…
Karen and Alison, partners in Carter Ledyard’s Trusts and Estates Department, discuss and explain the peculiarities of the New York estate tax regime, including the dreaded and draconian “cliff”, and offer…
Twenty-two Carter Ledyard attorneys were recognized by The Best Lawyers in America in their 2021 rankings.
Selection is highly competitive for this two-year fellowship, which provides attorneys with the opportunity to serve in leadership roles within the ABA, attend RPTE Section meetings, and receive mentorship from veteran trusts…
We continue to monitor and report on recent COVID-19 developments. Please refer to our Response Group’s homepage, where you'll find advisories from numerous attorneys on a wide range of subjects.
Carter Ledyard client Rita Gluzman, a 71-year-old federal inmate, successfully petitioned the Southern District of New York for compassionate release after spending nearly a quarter century in federal custody.