Business Litigation Introduction

We recognize that a business – no matter the size – and its owners, partners and shareholders are challenged with substantially greater exposure to legal issues than any individual would on a daily basis.  Whether it involves not being paid for outstanding invoices, disputes with partners, employment-related issues, understanding corporate regulations, engaging with litigious vendors, or a variety of other business litigation issues, you will need to be represented by an attorney and law firm which can not only get the work done, but will work WITH you at solving your problems.  Our experience in large New York City commercial litigation law firms and representing Fortune 500 companies prepared us for meeting the challenges you face.

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Business Litigation

Contracts and agreements

Having seen, witnessed and represented clients on various causes for breach of contract, it is imperative to have a knowledgeable business lawyer be able to draft contracts and agreements such as purchase and sale agreements, marketing-agency agreements, affiliate agreements, an operating agreement, joint ventures, and partnership agreements. A well-prepared contract or agreement can save you lots of money and future litigation aggravation.

Breach of contract

In almost every commercial litigation dispute, there are two sides alleging completely incongruent positions.

The essential elements of a breach of contract cause of action are:

        (i) the existence of a contract

(ii) the plaintiff’s (or claimant’s) performance pursuant to the contract;

(iii) the defendant’s breach of his or her contractual obligations

(iv) and damages resulting from the breach.

Generally, a party alleging a breach of contract must demonstrate the existence of a contract reflecting the terms and conditions of their purported agreement. Furthermore, a plaintiff’s allegations must identify the provisions of the contract that were breached.

fradulent and misrepresentation claims

The law recognizes two kinds of fraud: actual fraud and constructive fraud. 

In order to sustain an action for actual fraud, a plaintiff must prove:

(1) that the defendant made a representation

(2) as to a material fact

(3) which was false

(4) and known to be false by the defendant

(5) that the representation was made for the purpose of inducing the other party to rely upon it

(6) that the other party rightfully did so rely on that statement

(7) in ignorance of its falsity

(8) to his injury.

Conversely, constructive fraud may be defined as a breach of a duty which, irrespective of moral guilt and intent, the law declares fraudulent because of its tendency to deceive, to violate a confidence or to injure public or private interests which the law deems worthy of special protection.

Breach of fiduciary duty

To maintain a claim for breach of fiduciary duty, a plaintiff must show that he or she was owed a fiduciary duty in the first place. This is typically the case with shareholders of a corporation or where a party is in a relationship which would have violated his or her trust. For example, an executor of an estate who diverts money left by a decedent violates his fiduciary duty bound upon him by law to not steal from the remaining beneficiaries of the estate.

Tortious Interference

Tortious interference with contract requires the existence of a valid contract between the plaintiff and a third party, the defendant’s knowledge of that contract, defendant’s intentional procurement of the third-party’s breach of the contract without justification, an actual breach of the contract, and damages resulting therefrom.

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conversion

A conversion takes place when someone, intentionally and without authority, assumes or exercises control over personal property belonging to someone else, thus interfering with that person’s right of possession. 

Two key elements to prove for a cause of action for conversion are:

(1) a plaintiff’s possessory right or interest in the property

(2) defendant’s dominion over the property or interference with it, in derogation of the plaintiff’s rights

theft of trade secrets

The elements of misappropriation of trade secrets are:

(1) that plaintiff possessed a trade secret, and

(2) that the defendants used that trade secret in breach of an agreement, confidential relationship or duty, or as a result of discovery by improper means. 

A trade secret is any formula, pattern, device or compilation of information which is used in one’s business, and which gives him an opportunity to obtain an advantage over competitors who do not know or use it.  

As a general matter, courts consider several factors when determining what constitutes a trade secret, including:

(1) the extent to which the information is known outside of the business

(2) the extent to which it is known by employees and others involved in the business

(3) the extent of measures taken by the business to guard the secrecy of the information

(4) the value of the information to the business and its competitors

(5) the amount of effort or money expended by the business in developing the information

(6) the ease or difficulty with which the information could be properly acquired or duplicated by others.

partnership agreements

Partners may, absent prohibitory provisions of the statutes or of rules of the common law relating to partnerships, or considerations of public policy, include in the partnership articles any agreement the partners desire to include.  The partners of either a general or limited partnership, between themselves, may include in the partnership articles any agreement they wish concerning the sharing of profits and losses, priorities of distribution on winding up of the partnership affairs and other matters. If complete, the agreement signed by the partners controls.  In short, parties to a partnership agreement generally have the right to contract around a provision of the Partnership Law, provided of course they do so in language that is clear, unequivocal and unambiguous. No particular magic words need to be recited, provided that the parties’ intentions are made clear

Dissolution of a Partnership

The judicial dissolution statute, Partnership Law § 63, gives a partner the statutory right to seek court dissolution of a partnership and provides that a court shall decree the dissolution, on a partner’s application, in various situations, including circumstances that would render a dissolution equitable. It is well established that the Partnership Law’s provisions are default requirements that come into play in the absence of an agreement. The statutory scheme applies only when there is either no partnership agreement governing the partnership’s affairs, the agreement is silent on a particular point, or the agreement contains provisions contrary to law. Where an agreement addresses a particular issue, the terms of the agreement control, and the rights and obligations of the parties are determined by reference to principles of contract law. Thus, an agreement specifying the circumstances under which a partnership may be dissolved is not at will.

The Partnership Law provides that dissolution does not violate a partnership agreement if it occurs by the termination of the definite term or particular undertaking specified in the agreement.  For example, if a partnership agreement provides that the agreement will terminate on a certain date, then the dissolution of the partnership on that date will be in accordance with the agreement. Moreover, if no definite term or particular undertaking is specified in the partnership agreement, then the partnership is said to be an “at-will” partnership, and a unilateral dissolution by the express will of any partner does not violate the partnership agreement. When a partnership has no definite term or particular objective to be achieved, it may be dissolved at any time by the express will of one or more of the partners.

real estate litigation

Whether you own real property with a spouse, family member, friend or partner, the form of your ownership will vary from tenants by the entirety, tenants in common or joint tenants.

construction litigation

Sadly, more often that not, a homeowner may feel he has to sue a contractor, subcontractor, architect or engineer for errors that took place during the construction phase.  These mistakes and claims may range from light to serious

How can we help 

Our team of experienced attorneys have worked on large “high stakes” business litigation disputes and know what your rights are.  We also know that commercial litigation may be a costly endeavor for any business owner.  We pride ourselves on not only working with you, but also to help transition and explain complex matters to you with great patience

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Commercial Litigation
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Our experience in large New York City commercial litigation law firms and representing Fortune 500 companies prepared us for meeting the challenges you face. We recognize that a business – no matter the size – and its owners, partners and shareholders are challenged with substantially greater exposure to legal issues than any individual would on a daily basis.
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Cohen Montalto P.C.
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