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SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF KINGS
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JUN YAN GUAN, Individually and Derivatively on Behalf of
ANGEL GIFT NAIL SPA INC., ANGEL GIFT NAIL SPA ii Index No.: 506569/2022
INC., ANGEL GIFT NAIL SPA III INC., ANGEL GIFT
NAIL SPA IV INC., AT ANGEL GIFT NAIL SPA II INC.,
AT ANGEL GIFT NAIL SPA III INC., ANGEL CITY NAIL
SPA, INC., AT ANGEL CITY NAIL SPA, INC.,
Plaintiffs,
-against-
HUA CHEN a/k/a SUSAN HUA CHEN, TAO LIN,
JIANPING DAI, ANGEL GIFT NAIL SPA INC., ANGEL
GIFT NAIL SPA II INC., ANGEL GIFT NAIL SPA III INC.,
ANGEL GIFT NAIL SPA IV INC., AT ANGEL GIFT NAIL
SPA II INC., AT ANGEL GIFT NAIL SPA III INC., ANGEL
CITY NAIL SPA, INC., AT ANGEL CITY NAIL SPA INC.,
VINCENT HUANG, VINCENT HUANG CPA P.C., ROYAL
BUSINESS BANK, METRO CITY BANK,
Defendants.
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MEMORANDUM OF LAW IN SUPPORT OF MOTION TO DISMISS BY
VINCENT HUANG AND VINCENT HUANG CPA, P.C.
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PRELIMINARY STATEMENT
Defendants Vincent Huang and Vincent Huang CPA, P.C. (collectively “Huang”)
respectfully submit this Memorandum of Law in support of Huang’s motion to dismiss, pursuant
to CPLR § 3211, for an Order dismissing plaintiff’s complaint in its entirety, with prejudice, as
against Huang pursuant to CPLR §3211 (a)(1), (5) and (7) and for such other and further relief as
the Court may deem just, proper, and equitable. Additional facts relied upon in the instant motion
are included in the Affirmation of Dana K. Marjieh, dated April 25, 2022, and exhibits annexed
thereto (“Marjieh Aff.”) and the Affidavit of Vincent Huang, sworn to on April 21, 2022, and the
exhibits annexed thereto (“Huang Affidavit”).
In the instant suit, Plaintiff Jun Yan Guan (“Plaintiff” or “Guan”) claims, individually and
derivatively on behalf of various corporations that he was somehow stripped of his alleged
ownership interest in three nail salons, At Angel Gift Nail Spa III Inc. 1 (“Angel Gift III”), At Angel
City Nail Spa, Inc. (“Angel City”) 2 and At Angel Gift Spa II Inc. (“Angel Gift II”)3.
It is respectfully submitted that based on the facts as alleged in plaintiff’s complaint, his
claims for breach of fiduciary duty and professional/accountant malpractice as against Huang must
be dismissed based on the documentary evidence and statute of limitations and because plaintiff
has failed to state causes of action for breach of fiduciary duty or malpractice claim against Huang.
FACTUAL BACKGROUND
A complete recitation of the facts alleged by plaintiff are set forth in the Amended
Complaint (Marjieh Aff., Exhibit A) and incorporated herein by reference. Pertinent facts in
support of this Memorandum of Law and the arguments herein are provided below.
1
At Angel Gift Spa III Inc., is the successor in interest of Angel Gift Nail Spa III Inc. and Angel Gift Nail Spa Inc.
(collectively, Angel Gift III).
2
At Angel City Nail Spa, Inc., is the successor in interest of Angel City Nail Spa Inc. (collectively “Angel City”).
3
At Angel Gift Spa II Inc., is the successor in interest of Angel Gift Nail Spa IV Inc. and Angel Gift Nail Spa II Inc.
(collectively “Angel Gift II”).
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ARGUMENT
STANDARD OF REVIEW FOR MOTION TO DISMISS
On a motion to dismiss a complaint pursuant to CPLR 3211(a), the court must afford the
pleading a liberal construction, accept all facts as alleged in the pleading to be true, accord the
plaintiff the benefit of every possible inference, and determine only whether the facts as alleged
fit within any cognizable legal theory. See Breytman v. Olinville Realty, LLC, 54 A.D.3d 703, 864
N.Y.S.2d 70 (2d Dep’t 2008). However, bare legal conclusions and factual allegations
contradicted by the record are not presumed to be true, nor are they accorded every favorable
inference. See Id.; Riback v. Margulis, 43 A.D.3d 1023, 842 N.Y.S.2d 54 (2d Dep’t 2007). On
a motion to dismiss for failure to state a cause of action, the court is limited to an examination of
the pleadings to determine whether they state a cause of action. Dolphin Holdings, Ltd. V. Gander
& White Shipping, Inc., 122 A.D.3d 901 (2nd Dep’t 2014).
A court is permitted to consider evidentiary material submitted by a defendant in support
of a motion to dismiss pursuant to CPLR 3211(a). See CPLR §3211(c); Sokol v. Leader, 74 A.D.3d
1180, 1181–1182, 904 N.Y.S.2d 153 (2d Dep’t 2010). If the court considers the evidentiary
material submitted, the criterion then becomes whether the proponent of the pleading has a cause
of action, not whether one has been stated. See Sokol, 74 A.D.3d at 1181–1182, 904 N.Y.S.2d at
156 citing Guggenheimer v. Ginzburg, 43 N.Y.2d 268, 275, 401 N.Y.S.2d 182 (1977).
When the moving party submits affidavits or other documentary evidence in support of its
motion, dismissal under CPLR 3211 is warranted “only if the documentary evidence submitted
conclusively establishes a defense to the asserted claims as a matter of law.” Leon v Martinez, 84
N.Y.2d 83, 88, 614 N.Y.S.2d 972 (1994).
It is respectfully submitted that the documentary evidence submitted in support of the
instant motion conclusively establishes, as a matter of law, that (1) Huang did not breach any
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alleged fiduciary duty; (2) Huang did not commit professional malpractice; (3) the statute of
limitations for breach of fiduciary duty and professional malpractice have lapsed; and (4) plaintiff
cannot maintain any cause of action against Huang as a matter of law.
Plaintiff’s theory against Huang is that Huang, an accountant that was not retained by
Plaintiff, nor had any dealings with plaintiff, somehow breached a duty to plaintiff that it did not
owe. In the instant matter, the documentary evidence clearly demonstrates that plaintiff was not
an owner of Angel Gift II or Angel City. The documentary evidence further demonstrates that
plaintiff did not hold any interest in Angel Gift III until September 2021, at the earliest. Plaintiff,
therefore, cannot state a claim that Huang breached a duty to him. Plaintiffs’ claim for breach of
fiduciary duty and accountant malpractice, therefore, must be dismissed as a matter of law. Given
these mandates, Huang’s motion to dismiss the complaint pursuant to CPLR § 3211(a) must be
granted in its entirety.
POINT I
PLAINTIFF’S CAUSE OF ACTION FOR
BREACH OF FIDUCIARY DUTY FAILS AS A MATTER OF LAW
The elements of a cause of action to recover damages for breach of fiduciary duty are (1)
the existence of a fiduciary relationship, (2) misconduct by the defendant, and (3) damages directly
caused by the defendant’s misconduct.” Litvinoff v. Wright, 150 A.D.3d 714 (2d Dep’t 2017). The
duty owed by an accountant to a client is generally not fiduciary in nature, as required to state a
claim of breach of fiduciary duty. Able Energy, Inc. v. Marcum & Kliegman LLP, 69 A.D.3d 443
(1st Dep’t 2010)(Claim for breach of fiduciary duty was properly dismissed since duty owed by an
accountant to a client is generally not fiduciary in nature and plaintiff did not plead any of the
limited circumstances in which such a duty may arise); Bitter v. Renzo, 101 A.D.3d 465 (1st Dep’t
2012). Nor does a conventional business relationship, without more, create a fiduciary
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relationship. Friedman v. Anderson, 23 A.D.3d 163 (1st Dept. 2005). Further, intermittent
communications between an investor and accountant does not transform a conventional business
relationship into a fiduciary relationship. Staffenberg v. Fairfield Pagma Associates, L.P., 944
N.Y.S.2d 568 (2nd Dep’t 2012). Here, plaintiff admits that he did not interact with Huang and
alleges no specific conversations with Huang. Instead, plaintiff provides blanket accusations “upon
information and belief” within the complaint (Marjieh Aff., Exhibit A, ¶¶ 336-341) and does not
allege any alleged breach in specificity. In fact, it is clear that plaintiff was unfamiliar with Huang
and his services, as he claims that Huang failed to discuss the corporations formalities, books and
records with Huang, however Huang never prepared the books or handled the day to day
accounting for the corporations and plaintiff never inquired regarding the corporation to Huang.
See Huang Affidavit.
The case of Tal v. Superior Vending, LLC, 20 A.D.3d 520 (2nd Dep’t 2005) is instructive.
In Tal v. Superior Vending, LLC, et al., plaintiff, the alleged co-owner of vending company brought
claims against the company’s attorney and accountant for breach of fiduciary duty and fraud.
Plaintiff commenced the action against Superior alleging that both he and Plotkin had a 50%
ownership interest in Superior. Plaintiff also sued the accountant of Superior. The Supreme Court
dismissed the claims, plaintiff appealed and this Court affirmed the lower court’s decision and held
that the accountant had no fiduciary duty to the plaintiff/alleged co-owner, and thus could not be
liable for breach of fiduciary duty. 20 A.D.3d 520 (2nd Dep’t 2005).
Similarly, Huang does not owe a fiduciary duty to plaintiff, and thus plaintiff’s cause of
action for breach of fiduciary duty as against Huang must be dismissed. See accord Kolb v. LJ
Rabinowitz, CPA, 117 A.D.3d 978 (2nd Dep’t 2014)( A certified public accountant and his firm
were not fiduciaries of an automobile dealership that hired the accountant to review the books, and
oversee the dealership's in-house controller, thus barring the
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dealership's breach of fiduciary duty claim against the accountant after an outside forensic audit
revealed a $2.3 million discrepancy).
The instant breach of fiduciary duty cause of action must also be dismissed as duplicative
of the professional malpractice cause of action, since the breach of fiduciary duty cause of action
is based on the same allegations of wrongdoing as the professional malpractice action and seeks
the same damages. See accord, Bd. of Trustees of IBEW Loc. 43 Elec. Contractors Health &
Welfare, Annuity & Pension Funds v. D'Arcangelo & Co., LLP, 124 A.D.3d 1358, 1 N.Y.S.3d 659
(4th Dep’t 2015).
Accordingly, since plaintiff has failed to plead a cause of action for breach of fiduciary
duty against Huang, plaintiff’s claims for breach of fiduciary duty must be dismissed.
POINT II
PLAINTIFF’S CAUSE OF ACTION FOR
PROFESSIONAL MALPRACTICE FAILS AS A MATTER OF LAW
A party alleging a claim of accountant malpractice must show that there was a departure
from the accepted standards of practice. Deane v. Brodman, 192 A.D.3d 577 (1st Dept 2021).
Accounting malpractice or professional negligence contemplates a failure to exercise due care and
proof of a material deviation from the recognized and accepted professional standards
for accountants and auditors, which proximately causes damage to plaintiff. Bd. of Trustees of
IBEW Loc. 43 Elec. Contractors Health & Welfare, Annuity & Pension Funds v. D'Arcangelo &
Co., LLP, 124 A.D.3d 1358, 1 N.Y.S.3d 659 (4th Dep’t 2015).
Accounting malpractice contemplates a failure to exercise due care and proof of a material
deviation from recognized and accepted professional standards for accountants and auditors
Friedman v. Anderson, 23 A.D.3d 163(1st Dept 2005). Plaintiff must establish that defendant
departed from generally accepted accounting principles and the departure was the proximate cause
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of plaintiff's injury. Kristina Denise Enterprises v. Arnold, 41 A.D.3d 788 (2nd Dep’t 2007). To
establish a prima facie case of proximate cause, plaintiff must show that defendant's negligence
was a substantial cause of the events which produced the injury. Maheshwari v. New York, 2
N.Y.3d 288, 295 (2004).
Plaintiff’s allegations against Huang regarding alleged accountant malpractice are
premised on the misguided notion that Huang had an alleged duty to “avoid, ascertain and
remediate any potential conflicts of interests between plaintiff and Chen.” See Marjieh Aff.,
Exhibit A, §§343-345. There is no duty on behalf of an accountant to avoid, ascertain and
remediate any potential conflicts between their clients.
Plaintiff further claims that when Huang created correspondence reflecting an alleged
“diminution” to 10% ownership interest of Plaintiff in At Angel Gift Nail Spa III, Huang should
have alerted plaintiff regarding same. Marjieh Aff, Exhibit A, §§345-347. This is simply not true
as Huang always considered plaintiff as an employee of the corporations and never as an owner,
which is also reflected in all of the corporate tax documents. Thus Huang was under the impression
that this was the first time plaintiff was receiving an interest in any of the corporations. See Huang
Affidavit.
Accordingly, given plaintiff’s failure to plead any alleged departure from any recognized
accounting principles, plaintiff’s cause of action for accountant malpractice fails as a matter of law
and must be dismissed as a matter of law.
POINT III
PLAINTIFF’S CLAIMS AGAINST HUANG
ARE BARRED BY THE STATUTE OF LIMITATIONS
On a motion to dismiss a cause of action on the ground that it is barred by the statute of
limitations, a defendant bears the initial burden of establishing, prima facie, that the time in which
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to sue has expired. Kennedy v. H. Bruce Fischer, Esq., P.C., et al., 78 A.D.3d 1016 (2nd Dep’t
2010). Notwithstanding that plaintiff has failed to plead causes of action for both malpractice and
breach of fiduciary duty as against Huang, even assuming arguendo that those causes of action
were properly pled, which they were not, they would still mandate dismissal as both causes of
action are time barred.
Plaintiff’s Cause of Action for Malpractice is Time Barred
A claim sounding in accounting malpractice is governed by a three-year statute of
limitations. Wright v. Day, 134 A.D.3d 806 (2nd Dep’t 2015). Causes of action to recover damages
for accountant malpractice accrues and three-year limitations period began to run, when a certified
public accountant performed allegedly negligent work for a client. Rodeo Family Enterprises,
LLC, v. Matte, 99 A.D.3d 781 (2nd Dep’t 2012); Kolb v. LJ Rabinowitz, CPA, 117 A.D.3d 978 (2nd
Dep’t 2014). The continuous representation doctrine tolls the running of the statute of limitations
for professional malpractice claims until the completion of the professional’s ongoing services
concerning the matter out of which the malpractice claim arises, but not throughout the
continuation of a general professional relationship. Id. Unless services relating to the particular
transaction sued upon were rendered within the statute of limitations period, even professional’s
general and unfettered control of client’s financial, tax and investment affairs is insufficient to
sustain the timeliness of nonmedical malpractice action pursuant to continuous representation
doctrine. Booth v. Kriegel, 36 A.D.3d 312 (1st Dep’t 2006).
In Booth v. Kriegel, 36 A.D.3d (1st Dep’t 2006), the accountant’s preparation of each of
client’s federal income tax returns was discrete and severable transaction, and therefore
accountant’s work on client’s tax returns during three years preceding filing of client’s accounting
malpractice action did not toll running of three-year statute of limitations period on any claims
arising from accounting work on tax returns prepared for previous years pursuant to continuous
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representation doctrine even though accountant allegedly made same error in preparing each tax
return.
Similarly, in the case at bar, the alleged malpractice allegedly occurred when each of the
corporations were formed, since Huang was not included as an owner of any of the corporations
upon formation. Corporations for the three locations were formed in 2011, 2013 and 2015, over
six years prior to the date the instant action was commenced. Huang first assisted with the
incorporation of the successor in interest entities in 2015 and 2016, more than three years prior to
the commencement of this action. Huang also first prepared the tax returns for these entities in
2014, more than three years prior to the commencement of this action. Even assuming arguendo
that the formation of the successor in interest entities would be the date in which to trigger the
running of the statute of limitations (which it is not), the last date any of the entities were formed
was November 2, 2018, more than three years prior to the commencement of this action.
Accordingly, the statute of limitations for plaintiff’s claim for accountant malpractice has lapsed
and plaintiff’s cause of action for professional malpractice against Huang must be dismissed.
Plaintiff’s Cause of Action for Breach of Fiduciary Duty is Time Barred
Breach of fiduciary duty claim against an account that seeks a remedy that is purely
monetary in nature is governed by a three-year statute of limitations. See Kaufman v. Cohen, 307
A.D.2d 113 (1st Dep’t 2003); Weight v. Day, 134 A.D.3d 806 (2nd Dep’t 2015). Here, plaintiff
seeks monetary damages as against Huang with respect to his cause of action for breach of
fiduciary duty. See Marjieh Aff., Exhibit A. In the Amended Complaint, plaintiff claims that
Huang breached his alleged fiduciary duty to plaintiff when he, inter alia, failed to accurately
reflect plaintiff’s alleged ownership interests in the corporations and tax preparation. See Marjieh
Aff, Exhibit A, ¶¶ 336-341. These alleged omissions, which do not amount to a breach of fiduciary
duty, as discussed above, initially occurred in 2015 and 2016, occurred prior to 2018, and thus,
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more than three years from the filing of the instant action. Accordingly, plaintiff’s cause of action
for breach of fiduciary duty (which also fails as a matter of law) is barred by the statute of
limitations and must be dismissed with prejudice.
CONCLUSION
It is respectfully requested that the Complaint be dismissed in its entirety, with prejudice,
together with such other and further relief as the Court deems just and proper, including an award
of costs and sanctions pursuant to 22 N.Y.C.R.R. § 130-1.1
Dated: Elmsford, New York
April 25, 2022
BLACK MARJIEH & SANFORD LLP
Attorneys for Defendants Vincent Huang
and Vincent Huang CPA P.C.
By: _______________________________
Dana Khalife-Marjieh, Esq.
100 Clearbrook Road, Suite 345
Elmsford, New York 10523
Tel: (914) 704-4400
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NO. 56 RECEIVED NYSCEF: 04/25/2022 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF KINGS --------------------------------------------------------------------------X JUN YAN GUAN, Individually and Derivatively on Behalf of ANGEL GIFT NAIL SPA INC., ANGEL GIFT NAIL SPA ii Index No.: 506569/2022 INC., ANGEL GIFT NAIL SPA III INC., ANGEL GIFT NAIL SPA IV INC., AT ANGEL GIFT NAIL SPA II INC., AT ANGEL GIFT NAIL SPA III INC., ANGEL CITY NAIL SPA, INC., AT ANGEL CITY NAIL SPA, INC., Plaintiffs, -against- HUA CHEN a/k/a SUSAN HUA CHEN, TAO LIN, JIANPING DAI, ANGEL GIFT NAIL SPA INC., ANGEL GIFT NAIL SPA II INC., ANGEL GIFT NAIL SPA III INC., ANGEL GIFT NAIL SPA IV INC., AT ANGEL GIFT NAIL SPA II INC., AT ANGEL GIFT NAIL SPA III INC., ANGEL CITY NAIL SPA, INC., AT ANGEL CITY NAIL SPA INC., VINCENT HUANG, VINCENT HUANG CPA P.C., ROYAL BUSINESS BANK, METRO CITY BANK, Defendants. --------------------------------------------------------------------------X MEMORANDUM OF LAW IN SUPPORT OF MOTION TO DISMISS BY VINCENT HUANG AND VINCENT HUANG CPA, P.C. 1 of 10 FILED: KINGS COUNTY CLERK 04/25/2022 02:16 PM INDEX NO. 506569/2022 NYSCEF DOC. NO. 56 RECEIVED NYSCEF: 04/25/2022 PRELIMINARY STATEMENT Defendants Vincent Huang and Vincent Huang CPA, P.C. (collectively “Huang”) respectfully submit this Memorandum of Law in support of Huang’s motion to dismiss, pursuant to CPLR § 3211, for an Order dismissing plaintiff’s complaint in its entirety, with prejudice, as against Huang pursuant to CPLR §3211 (a)(1), (5) and (7) and for such other and further relief as the Court may deem just, proper, and equitable. Additional facts relied upon in the instant motion are included in the Affirmation of Dana K. Marjieh, dated April 25, 2022, and exhibits annexed thereto (“Marjieh Aff.”) and the Affidavit of Vincent Huang, sworn to on April 21, 2022, and the exhibits annexed thereto (“Huang Affidavit”). In the instant suit, Plaintiff Jun Yan Guan (“Plaintiff” or “Guan”) claims, individually and derivatively on behalf of various corporations that he was somehow stripped of his alleged ownership interest in three nail salons, At Angel Gift Nail Spa III Inc. 1 (“Angel Gift III”), At Angel City Nail Spa, Inc. (“Angel City”) 2 and At Angel Gift Spa II Inc. (“Angel Gift II”)3. It is respectfully submitted that based on the facts as alleged in plaintiff’s complaint, his claims for breach of fiduciary duty and professional/accountant malpractice as against Huang must be dismissed based on the documentary evidence and statute of limitations and because plaintiff has failed to state causes of action for breach of fiduciary duty or malpractice claim against Huang. FACTUAL BACKGROUND A complete recitation of the facts alleged by plaintiff are set forth in the Amended Complaint (Marjieh Aff., Exhibit A) and incorporated herein by reference. Pertinent facts in support of this Memorandum of Law and the arguments herein are provided below. 1 At Angel Gift Spa III Inc., is the successor in interest of Angel Gift Nail Spa III Inc. and Angel Gift Nail Spa Inc. (collectively, Angel Gift III). 2 At Angel City Nail Spa, Inc., is the successor in interest of Angel City Nail Spa Inc. (collectively “Angel City”). 3 At Angel Gift Spa II Inc., is the successor in interest of Angel Gift Nail Spa IV Inc. and Angel Gift Nail Spa II Inc. (collectively “Angel Gift II”). 2 of 10 FILED: KINGS COUNTY CLERK 04/25/2022 02:16 PM INDEX NO. 506569/2022 NYSCEF DOC. NO. 56 RECEIVED NYSCEF: 04/25/2022 ARGUMENT STANDARD OF REVIEW FOR MOTION TO DISMISS On a motion to dismiss a complaint pursuant to CPLR 3211(a), the court must afford the pleading a liberal construction, accept all facts as alleged in the pleading to be true, accord the plaintiff the benefit of every possible inference, and determine only whether the facts as alleged fit within any cognizable legal theory. See Breytman v. Olinville Realty, LLC, 54 A.D.3d 703, 864 N.Y.S.2d 70 (2d Dep’t 2008). However, bare legal conclusions and factual allegations contradicted by the record are not presumed to be true, nor are they accorded every favorable inference. See Id.; Riback v. Margulis, 43 A.D.3d 1023, 842 N.Y.S.2d 54 (2d Dep’t 2007). On a motion to dismiss for failure to state a cause of action, the court is limited to an examination of the pleadings to determine whether they state a cause of action. Dolphin Holdings, Ltd. V. Gander & White Shipping, Inc., 122 A.D.3d 901 (2nd Dep’t 2014). A court is permitted to consider evidentiary material submitted by a defendant in support of a motion to dismiss pursuant to CPLR 3211(a). See CPLR §3211(c); Sokol v. Leader, 74 A.D.3d 1180, 1181–1182, 904 N.Y.S.2d 153 (2d Dep’t 2010). If the court considers the evidentiary material submitted, the criterion then becomes whether the proponent of the pleading has a cause of action, not whether one has been stated. See Sokol, 74 A.D.3d at 1181–1182, 904 N.Y.S.2d at 156 citing Guggenheimer v. Ginzburg, 43 N.Y.2d 268, 275, 401 N.Y.S.2d 182 (1977). When the moving party submits affidavits or other documentary evidence in support of its motion, dismissal under CPLR 3211 is warranted “only if the documentary evidence submitted conclusively establishes a defense to the asserted claims as a matter of law.” Leon v Martinez, 84 N.Y.2d 83, 88, 614 N.Y.S.2d 972 (1994). It is respectfully submitted that the documentary evidence submitted in support of the instant motion conclusively establishes, as a matter of law, that (1) Huang did not breach any 3 of 10 FILED: KINGS COUNTY CLERK 04/25/2022 02:16 PM INDEX NO. 506569/2022 NYSCEF DOC. NO. 56 RECEIVED NYSCEF: 04/25/2022 alleged fiduciary duty; (2) Huang did not commit professional malpractice; (3) the statute of limitations for breach of fiduciary duty and professional malpractice have lapsed; and (4) plaintiff cannot maintain any cause of action against Huang as a matter of law. Plaintiff’s theory against Huang is that Huang, an accountant that was not retained by Plaintiff, nor had any dealings with plaintiff, somehow breached a duty to plaintiff that it did not owe. In the instant matter, the documentary evidence clearly demonstrates that plaintiff was not an owner of Angel Gift II or Angel City. The documentary evidence further demonstrates that plaintiff did not hold any interest in Angel Gift III until September 2021, at the earliest. Plaintiff, therefore, cannot state a claim that Huang breached a duty to him. Plaintiffs’ claim for breach of fiduciary duty and accountant malpractice, therefore, must be dismissed as a matter of law. Given these mandates, Huang’s motion to dismiss the complaint pursuant to CPLR § 3211(a) must be granted in its entirety. POINT I PLAINTIFF’S CAUSE OF ACTION FOR BREACH OF FIDUCIARY DUTY FAILS AS A MATTER OF LAW The elements of a cause of action to recover damages for breach of fiduciary duty are (1) the existence of a fiduciary relationship, (2) misconduct by the defendant, and (3) damages directly caused by the defendant’s misconduct.” Litvinoff v. Wright, 150 A.D.3d 714 (2d Dep’t 2017). The duty owed by an accountant to a client is generally not fiduciary in nature, as required to state a claim of breach of fiduciary duty. Able Energy, Inc. v. Marcum & Kliegman LLP, 69 A.D.3d 443 (1st Dep’t 2010)(Claim for breach of fiduciary duty was properly dismissed since duty owed by an accountant to a client is generally not fiduciary in nature and plaintiff did not plead any of the limited circumstances in which such a duty may arise); Bitter v. Renzo, 101 A.D.3d 465 (1st Dep’t 2012). Nor does a conventional business relationship, without more, create a fiduciary 4 of 10 FILED: KINGS COUNTY CLERK 04/25/2022 02:16 PM INDEX NO. 506569/2022 NYSCEF DOC. NO. 56 RECEIVED NYSCEF: 04/25/2022 relationship. Friedman v. Anderson, 23 A.D.3d 163 (1st Dept. 2005). Further, intermittent communications between an investor and accountant does not transform a conventional business relationship into a fiduciary relationship. Staffenberg v. Fairfield Pagma Associates, L.P., 944 N.Y.S.2d 568 (2nd Dep’t 2012). Here, plaintiff admits that he did not interact with Huang and alleges no specific conversations with Huang. Instead, plaintiff provides blanket accusations “upon information and belief” within the complaint (Marjieh Aff., Exhibit A, ¶¶ 336-341) and does not allege any alleged breach in specificity. In fact, it is clear that plaintiff was unfamiliar with Huang and his services, as he claims that Huang failed to discuss the corporations formalities, books and records with Huang, however Huang never prepared the books or handled the day to day accounting for the corporations and plaintiff never inquired regarding the corporation to Huang. See Huang Affidavit. The case of Tal v. Superior Vending, LLC, 20 A.D.3d 520 (2nd Dep’t 2005) is instructive. In Tal v. Superior Vending, LLC, et al., plaintiff, the alleged co-owner of vending company brought claims against the company’s attorney and accountant for breach of fiduciary duty and fraud. Plaintiff commenced the action against Superior alleging that both he and Plotkin had a 50% ownership interest in Superior. Plaintiff also sued the accountant of Superior. The Supreme Court dismissed the claims, plaintiff appealed and this Court affirmed the lower court’s decision and held that the accountant had no fiduciary duty to the plaintiff/alleged co-owner, and thus could not be liable for breach of fiduciary duty. 20 A.D.3d 520 (2nd Dep’t 2005). Similarly, Huang does not owe a fiduciary duty to plaintiff, and thus plaintiff’s cause of action for breach of fiduciary duty as against Huang must be dismissed. See accord Kolb v. LJ Rabinowitz, CPA, 117 A.D.3d 978 (2nd Dep’t 2014)( A certified public accountant and his firm were not fiduciaries of an automobile dealership that hired the accountant to review the books, and oversee the dealership's in-house controller, thus barring the 5 of 10 FILED: KINGS COUNTY CLERK 04/25/2022 02:16 PM INDEX NO. 506569/2022 NYSCEF DOC. NO. 56 RECEIVED NYSCEF: 04/25/2022 dealership's breach of fiduciary duty claim against the accountant after an outside forensic audit revealed a $2.3 million discrepancy). The instant breach of fiduciary duty cause of action must also be dismissed as duplicative of the professional malpractice cause of action, since the breach of fiduciary duty cause of action is based on the same allegations of wrongdoing as the professional malpractice action and seeks the same damages. See accord, Bd. of Trustees of IBEW Loc. 43 Elec. Contractors Health & Welfare, Annuity & Pension Funds v. D'Arcangelo & Co., LLP, 124 A.D.3d 1358, 1 N.Y.S.3d 659 (4th Dep’t 2015). Accordingly, since plaintiff has failed to plead a cause of action for breach of fiduciary duty against Huang, plaintiff’s claims for breach of fiduciary duty must be dismissed. POINT II PLAINTIFF’S CAUSE OF ACTION FOR PROFESSIONAL MALPRACTICE FAILS AS A MATTER OF LAW A party alleging a claim of accountant malpractice must show that there was a departure from the accepted standards of practice. Deane v. Brodman, 192 A.D.3d 577 (1st Dept 2021). Accounting malpractice or professional negligence contemplates a failure to exercise due care and proof of a material deviation from the recognized and accepted professional standards for accountants and auditors, which proximately causes damage to plaintiff. Bd. of Trustees of IBEW Loc. 43 Elec. Contractors Health & Welfare, Annuity & Pension Funds v. D'Arcangelo & Co., LLP, 124 A.D.3d 1358, 1 N.Y.S.3d 659 (4th Dep’t 2015). Accounting malpractice contemplates a failure to exercise due care and proof of a material deviation from recognized and accepted professional standards for accountants and auditors Friedman v. Anderson, 23 A.D.3d 163(1st Dept 2005). Plaintiff must establish that defendant departed from generally accepted accounting principles and the departure was the proximate cause 6 of 10 FILED: KINGS COUNTY CLERK 04/25/2022 02:16 PM INDEX NO. 506569/2022 NYSCEF DOC. NO. 56 RECEIVED NYSCEF: 04/25/2022 of plaintiff's injury. Kristina Denise Enterprises v. Arnold, 41 A.D.3d 788 (2nd Dep’t 2007). To establish a prima facie case of proximate cause, plaintiff must show that defendant's negligence was a substantial cause of the events which produced the injury. Maheshwari v. New York, 2 N.Y.3d 288, 295 (2004). Plaintiff’s allegations against Huang regarding alleged accountant malpractice are premised on the misguided notion that Huang had an alleged duty to “avoid, ascertain and remediate any potential conflicts of interests between plaintiff and Chen.” See Marjieh Aff., Exhibit A, §§343-345. There is no duty on behalf of an accountant to avoid, ascertain and remediate any potential conflicts between their clients. Plaintiff further claims that when Huang created correspondence reflecting an alleged “diminution” to 10% ownership interest of Plaintiff in At Angel Gift Nail Spa III, Huang should have alerted plaintiff regarding same. Marjieh Aff, Exhibit A, §§345-347. This is simply not true as Huang always considered plaintiff as an employee of the corporations and never as an owner, which is also reflected in all of the corporate tax documents. Thus Huang was under the impression that this was the first time plaintiff was receiving an interest in any of the corporations. See Huang Affidavit. Accordingly, given plaintiff’s failure to plead any alleged departure from any recognized accounting principles, plaintiff’s cause of action for accountant malpractice fails as a matter of law and must be dismissed as a matter of law. POINT III PLAINTIFF’S CLAIMS AGAINST HUANG ARE BARRED BY THE STATUTE OF LIMITATIONS On a motion to dismiss a cause of action on the ground that it is barred by the statute of limitations, a defendant bears the initial burden of establishing, prima facie, that the time in which 7 of 10 FILED: KINGS COUNTY CLERK 04/25/2022 02:16 PM INDEX NO. 506569/2022 NYSCEF DOC. NO. 56 RECEIVED NYSCEF: 04/25/2022 to sue has expired. Kennedy v. H. Bruce Fischer, Esq., P.C., et al., 78 A.D.3d 1016 (2nd Dep’t 2010). Notwithstanding that plaintiff has failed to plead causes of action for both malpractice and breach of fiduciary duty as against Huang, even assuming arguendo that those causes of action were properly pled, which they were not, they would still mandate dismissal as both causes of action are time barred. Plaintiff’s Cause of Action for Malpractice is Time Barred A claim sounding in accounting malpractice is governed by a three-year statute of limitations. Wright v. Day, 134 A.D.3d 806 (2nd Dep’t 2015). Causes of action to recover damages for accountant malpractice accrues and three-year limitations period began to run, when a certified public accountant performed allegedly negligent work for a client. Rodeo Family Enterprises, LLC, v. Matte, 99 A.D.3d 781 (2nd Dep’t 2012); Kolb v. LJ Rabinowitz, CPA, 117 A.D.3d 978 (2nd Dep’t 2014). The continuous representation doctrine tolls the running of the statute of limitations for professional malpractice claims until the completion of the professional’s ongoing services concerning the matter out of which the malpractice claim arises, but not throughout the continuation of a general professional relationship. Id. Unless services relating to the particular transaction sued upon were rendered within the statute of limitations period, even professional’s general and unfettered control of client’s financial, tax and investment affairs is insufficient to sustain the timeliness of nonmedical malpractice action pursuant to continuous representation doctrine. Booth v. Kriegel, 36 A.D.3d 312 (1st Dep’t 2006). In Booth v. Kriegel, 36 A.D.3d (1st Dep’t 2006), the accountant’s preparation of each of client’s federal income tax returns was discrete and severable transaction, and therefore accountant’s work on client’s tax returns during three years preceding filing of client’s accounting malpractice action did not toll running of three-year statute of limitations period on any claims arising from accounting work on tax returns prepared for previous years pursuant to continuous 8 of 10 FILED: KINGS COUNTY CLERK 04/25/2022 02:16 PM INDEX NO. 506569/2022 NYSCEF DOC. NO. 56 RECEIVED NYSCEF: 04/25/2022 representation doctrine even though accountant allegedly made same error in preparing each tax return. Similarly, in the case at bar, the alleged malpractice allegedly occurred when each of the corporations were formed, since Huang was not included as an owner of any of the corporations upon formation. Corporations for the three locations were formed in 2011, 2013 and 2015, over six years prior to the date the instant action was commenced. Huang first assisted with the incorporation of the successor in interest entities in 2015 and 2016, more than three years prior to the commencement of this action. Huang also first prepared the tax returns for these entities in 2014, more than three years prior to the commencement of this action. Even assuming arguendo that the formation of the successor in interest entities would be the date in which to trigger the running of the statute of limitations (which it is not), the last date any of the entities were formed was November 2, 2018, more than three years prior to the commencement of this action. Accordingly, the statute of limitations for plaintiff’s claim for accountant malpractice has lapsed and plaintiff’s cause of action for professional malpractice against Huang must be dismissed. Plaintiff’s Cause of Action for Breach of Fiduciary Duty is Time Barred Breach of fiduciary duty claim against an account that seeks a remedy that is purely monetary in nature is governed by a three-year statute of limitations. See Kaufman v. Cohen, 307 A.D.2d 113 (1st Dep’t 2003); Weight v. Day, 134 A.D.3d 806 (2nd Dep’t 2015). Here, plaintiff seeks monetary damages as against Huang with respect to his cause of action for breach of fiduciary duty. See Marjieh Aff., Exhibit A. In the Amended Complaint, plaintiff claims that Huang breached his alleged fiduciary duty to plaintiff when he, inter alia, failed to accurately reflect plaintiff’s alleged ownership interests in the corporations and tax preparation. See Marjieh Aff, Exhibit A, ¶¶ 336-341. These alleged omissions, which do not amount to a breach of fiduciary duty, as discussed above, initially occurred in 2015 and 2016, occurred prior to 2018, and thus, 9 of 10 FILED: KINGS COUNTY CLERK 04/25/2022 02:16 PM INDEX NO. 506569/2022 NYSCEF DOC. NO. 56 RECEIVED NYSCEF: 04/25/2022 more than three years from the filing of the instant action. Accordingly, plaintiff’s cause of action for breach of fiduciary duty (which also fails as a matter of law) is barred by the statute of limitations and must be dismissed with prejudice. CONCLUSION It is respectfully requested that the Complaint be dismissed in its entirety, with prejudice, together with such other and further relief as the Court deems just and proper, including an award of costs and sanctions pursuant to 22 N.Y.C.R.R. § 130-1.1 Dated: Elmsford, New York April 25, 2022 BLACK MARJIEH & SANFORD LLP Attorneys for Defendants Vincent Huang and Vincent Huang CPA P.C. By: _______________________________ Dana Khalife-Marjieh, Esq. 100 Clearbrook Road, Suite 345 Elmsford, New York 10523 Tel: (914) 704-4400 10 of 10