Summary
This Appellate Division, Second Department decision reviews an order denying defendants' motions to dismiss various causes of action, including breach of fiduciary duty, constructive fraud, and civil conspiracy. The court modified the lower court's order by granting dismissal of several claims against the defendants, primarily due to the expiration of the applicable statute of limitations, failure to adequately plead a fiduciary relationship, and lack of demand futility for derivative claims. The remaining claims were affirmed.
Topics
Practice areas
Questions Presented
- Whether the sixth cause of action for breach of fiduciary duty against NYU is time‑barred under the three‑year statute of limitations for monetary relief
- Whether the sixth cause of action against the HMG defendants is likewise time‑barred
- Whether the fifth, seventh, ninth, and fourteenth causes of action against Michael Wasileski should be dismissed for lack of fiduciary relationship or underlying tort
- Whether the derivative claim under BCL §626 should be dismissed for failure to plead demand or futility
Holdings
- The court granted NYU's motion to dismiss the sixth cause of action as time‑barred because the claim is subject to a three‑year limitations period that began on June 1, 2015.
- The court granted dismissal of the sixth cause of action against HMG, Bhasin, Filiberto, and Calderera as time‑barred for the same reasons as NYU.
- The court granted dismissal of those causes of action because the plaintiff failed to plead a fiduciary relationship or underlying torts.
Key quotations
“'New York law does not provide a single statute of limitations for breach of fiduciary duty claims' (Roumi v Guardian Life Ins. Co. of Am., 191 AD3d 911, 912).”
“'Generally, a cause of action alleging breach of fiduciary duty is governed by a six‑year statute of limitations where the relief sought is equitable in nature, or by a three‑year statute of limitations where the only relief sought is money damages' (Loeuis v Grushin, 126 AD3d 761, 764).”
Factual background
In 2003 Diane Moriarty became a shareholder of Huntington Medical Group, P.C. (HMG) and a member of Humgro Associates, LLC, which owned the property where HMG operated. In April 2015 NYU Langone Health, HMG, and Humgro entered into an integration agreement. Moriarty died, and her estate sued NYU, HMG, Humgro, and several officers/directors alleging breach of fiduciary duty and related claims.
Procedural history
The plaintiff, as executor of Moriarty's estate, filed a breach‑of‑fiduciary‑duty action in Suffolk County Supreme Court. The trial court denied multiple motions to dismiss. The defendants appealed the denials to the Appellate Division, Second Department.