Olshan Secures Affirmance of Consumer Class-Action Dismissal in New Jersey’s Appellate Division
On May 31, 2022, New Jersey’s Appellate Division affirmed the dismissal of a consumer class-action lawsuit that was filed against Olshan’s client, a marketer of a male hair-regrowth product. The class action was filed under New Jersey’s Consumer Fraud Act, one of the most pro-consumer statutes in the nation. It was dismissed on summary judgment prior to any discovery being conducted. Professional plaintiff Harold Hoffman claimed that the product was falsely advertised, but Olshan argued successfully on both the trial-court and appellate levels that Hoffman’s failure to use the supplement before filing suit meant that he had not suffered any compensable loss. The three-judge appellate panel agreed, ruling that the ascertainable loss requirement of the Consumer Fraud Act had not been satisfied. Scott Shaffer handled the appeal on behalf of Olshan. Read the decision here.
Appellate Division Affirms Grant of Summary Judgment Holding that Olshan Client Was Not Required to Pay Unlicensed Subcontractor
On May 26, 2022, New York’s First Appellate Department granted a unanimous win to Olshan’s client, a California construction company. The client hired a plumbing subcontractor for a major project, but learned later that the subcontractor was unlicensed and had submitted a phony license number. Before the client learned the truth, it had signed a letter waiving all rights to assert defenses or claims against the subcontractor. The case was further complicated by the fact that the subcontractor factored the debt out to a New York lender for collection. California law strictly prohibits paying unlicensed contractors, but New York law has no such rule, and the case was filed in New York by the lender. The trial court ruled in favor of Olshan’s client but relied on the wrong section of New York’s Uniform Commercial Code. On appeal, the panel affirmed the ruling but substituted an alternate rationale put forth by Olshan. As a result, Olshan’s client will not have to pay the subcontractor’s bills even though the bills could have been enforceable under New York law. Scott Shaffer represented Olshan’s client. Read the decision here.
Appellate Division Affirms Denial of Summary Judgment and Holding that Olshan Client Properly Pled Claims for Breach of Contract and Reformation of Warrant Agreement
On September 21, 2021, the First Department of the Supreme Court, State of New York, affirmed the trial court’s ruling that client Empery Asset Master, Ltd. had stated claims for breach of contract and for reformation of contract on a warrant agreement. The court agreed that Empery had shown that the agreement was ambiguous, and raised questions of fact as to whether there was mutual mistake or a scrivener’s error. In so doing, the court rejected defendant’s effort to relitigate issues already decided six months before when the First Department affirmed denial of defendant’s motion to dismiss. On October 14, 2021, the trial court held that Empery had proven its claims. Thomas Fleming and Kerrin Klein represented Empery. Read the decisions here and here.
Appellate Division Affirms Preliminary Injunction Granted to Olshan Client Vector Media, LLC
On October 13, 2020, the First Department of the Supreme Court, State of New York, affirmed a preliminary injunction granted to Vector Media to enforce its exclusive contract right to sell and place ads on sightseeing buses. While the underlying trial court decision predated the onset of the Covid-19 pandemic, the First Department rejected defendant’s effort to vacate the underlying order on the argument that the pandemic had rendered performance an impossibility. Brian Katz led the Olshan team. Read the decision here.
Order Rescinding Securities Purchase Agreement on Grounds of Fraud Affirmed
On February 18, 2020, the First Department of the Supreme Court, State of New York, affirmed the trial court’s judgment, after an eight-day bench trial, that the corporation in which Olshan’s client had invested had falsely represented that its largest shareholder was an affiliate, which would have prevented that shareholder from rapidly selling off its shares causing a substantial drop in stock price and that the misrepresentation had induced Olshan’s client to purchase securities in a private placement. The First Department held that the corporation’s misrepresentation was material, Olshan’s client did not have an adequate remedy at law and that rescission was warranted on grounds of fraudulent inducement. Such relief – the rescission of a stock purchase agreement – is rarely granted. Thomas Fleming and Peter Sartorius represented client Sabby Healthcare Master Fund Ltd. Read the decision here.
