Preview
FILED: NASSAU COUNTY CLERK 02/13/2023 05:22 PM INDEX NO. 607197/2022
NYSCEF DOC. NO. 89 RECEIVED NYSCEF: 02/13/2023
Exhibit C
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SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NASSAU
xxxxxx xxxxxx a/k/a xxxxxxxxxx
xxxxxx, individually and derivatively on
behalf of ROCKVILLE CORP., Index No.: 607197/2022
Plaintiff, Hon. Sharon M.J. Gianelli
-against- COUNTERCLAIM-
DEFENDANTS’ REPLY TO
xxxxxxx xxxxx, individually and as the DEFENDANT xxxxxxx
executor of the Estate of xxxx xxxxx, and as xxxxx’S COUNTERCLAIMS
co-trustee of the disclaimer Trust under
Article “Fourth” of the Last Will and
Testament of xxxx xxxxx; MAKAN
DELRAHIM, as former co-trustee of the
disclaimer Trust under Article “Fourth” of the
Last Will and Testament of xxxx xxxxx; and
BAHARAK AMIRIAN as co-trustee of the
disclaimer Trust under the Last Will and
Testament of xxxx xxxxx,
Defendants,
-and-
ROCKVILLE CORP.
Nominal Defendant.
xxxxxxx xxxxx and ROCKVILLE CORP.,
Counterclaim-Plaintiffs
-against-
xxxxxx xxxxxx and 172 BARGAIN LIQUORS
INC.
Counterclaim-Defendants.
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Plaintiff and counterclaim-defendant, xxxxxx xxxxxx a/k/a xxxxxxxxxx xxxxxx,
individually and derivatively on behalf of Rockville Corp. (“Plaintiff”), and counterclaim-
defendant 172 BARGAIN LIQUORS INC. (“Bargain Liquors”, collectively “Counterclaim-
Defendants”) by their attorneys, Ruskin Moscou Faltischek, P.C., as and for their reply to
defendant xxxxxxx xxxxx’s (“Defendant” or “xxxxxxx”) Answer to the Complaint and
Counterclaims, dated October 24, 2022 (“Counterclaims”), allege as follows:
COUNTERCLAIMS
NATURE OF THE ACTION
1. These Counterclaims arise from xxxxxx’s despicable bad faith actions towards his
late brother’s widow, xxxxxxx and her family, including xxxxxx’s failure to pay millions of dollars
that xxxxxx owes to xxxxxxx, his failure to negotiate in good faith a resolution of his debt to xxxxxxx,
his fraudulent and coercive tactics to block a sale of xxxxxxx’s property, and his filing of his suit
seeking to wrongfully obtain an 80% interest in that property. xxxxxx’s actions have brought
shame upon him and his family, as his and their conduct demonstrate the height of ingratitude and
disrespect for xxxx’s and xxxxxxx’s more than three decades of providing financial and every other
kind of help to xxxxxx and his family. This is another terrible example of no good deed by xxxx
and xxxxxxx towards xxxxxx going unpunished.
RESPONSE: Deny the allegations contained in paragraph “1” of the Counterclaims.
2. The allegations in xxxxxx’s Complaint present a completely false version of
history. xxxxxx asserts – with no proof whatsoever – that he owns 80% of Rockville, and therefore,
has the right to block Counterclaim-Plaintiff xxxxxxx xxxxx’s sale of Rockville’s sole asset –
property on Sunrise Highway in Rockville Centre, New York.
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RESPONSE: Deny the allegations contained in paragraph “2” of the Counterclaims, except admit
that Rockville’s sole asset is real property located at 172 Sunrise Highway, Rockville Centre, New
York and surrounding lots s (Section 38; Block: 317; Lot 130, 359 and 369).
3. xxxxxx’s claims of such ownership are false. As set forth more fully herein, there
is no question that Rockville is 100% owned by xxxxxxx, and has for the entirety of its existence –
over 25 years – been owned entirely by xxxxxxx’s late husband, xxxx, and then passed through his
will to xxxxxxx.
RESPONSE: Deny the allegations contained in paragraph “3” of the Counterclaims.
4. xxxxxxx’s 100% ownership of Rockville is conclusively established by
contemporaneous corporate documents, estate filings, K-1s showing that xxxx was 100% owner
before his death in 2008, and then K-1s showing xxxxxxx has been 100% owner of Rockville since
2008. Indeed, for 25 years, xxxx and then xxxxxxx, have filed tax returns for Rockville reflecting
their 100% ownership, and have personally paid income taxes on Rockville’s earnings.
RESPONSE: Deny the allegations contained in paragraph “4” of the Counterclaims.
5. xxxxxx’s claim that he is 80% owner of Rockville is therefore conclusively refuted
by 25 years of corporate filings, tax filings, and other documentary proof.
RESPONSE: Deny the allegations contained in paragraph “5” of the Counterclaims.
6. xxxxxx is wrongfully trying to strongarm his late brother’s widow by scuttling her
attempts to sell her property, wrongfully and fraudulently attempting to claim ownership over the
corporation she inherited from her late husband, and wrongfully withholding money from, and
unjustly enriching himself at the expense of, his late brother’s widow.
RESPONSE: Deny the allegations contained in paragraph “6” of the Counterclaims.
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7. Through these counterclaims, xxxxxxx and Rockville seek (i) monetary damages
arising from xxxxxx’s improper blocking of the sale of xxxxxxx’s property; (ii) monetary damages
arising from xxxxxx’s improper withholding of the 20% of profits from Bargain Liquors due and
owing to xxxxxxx; (iii) an accounting of Bargain Liquors’ books and records, tax returns and other
documents, to which xxxxxxx holds a 20% interest; (iv) appointment of a receiver for Bargain
Liquors’ funds and property in order to preserve them and prevent any further loss for xxxxxxx
until this Court has fully determined, and Counterclaim-Defendants have fully satisfied, the
amount due and owing to her; and (v) an order declaring xxxxxxx is 100% owner of Rockville and
Rockville’s property in Rockville Centre.
RESPONSE: Paragraph “7” of the Counterclaims is not an allegation to which a response is
required. To the extent a response is called for, Counterclaim-Defendants deny the truth of the
allegations therein.
PARTIES
8. Counterclaim-Plaintiff xxxxxxx xxxxx resides in the Nassau County, New York.
RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of
the allegations contained in paragraph “8” of the Counterclaims, except avers, upon information
and belief, that xxxxxxx xxxxx resides in Nassau County.
9. Counterclaim-Plaintiff Rockville Corporation is a domestic corporation formed
under the laws of the State of New York, with its principal place of business located at 26
Sandpiper Court, Old Westbury, New York 11568.
RESPONSE: Deny the allegations contained in paragraph “9” of the Counterclaims.
10. Upon information and belief, Counterclaim-Defendant xxxxxx xxxxxx is a natural
person residing at 5 Copperfield Lane, Old Westbury, New York 11568.
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RESPONSE: Admit the truth of the allegations contained in Paragraph “10” of the Counterclaims.
11. Upon information and belief, Counterclaim-Defendant 172 Bargain Liquors is a
domestic corporation formed under the laws of the State of New York, with its principal place of
business located at 172 Sunrise Highway, Rockville Centre, New York 11570.
RESPONSE: Admit the truth of the allegations contained in Paragraph “11” of the Counterclaims.
JURISDICTION AND VENUE
12. This Court has jurisdiction over this proceeding on the grounds that: (i) this action
arises out of the same or similar occurrences as alleged in the Complaint; and (ii) pursuant to CPLR
§ 301, as the Counterclaim-Defendants reside in the State of New York.
RESPONSE: Admit the truth of the allegations contained in Paragraph “12” of the Counterclaims.
13. Venue is appropriate pursuant to CPLR §§ 503(a) & (c), as all parties reside in this
county.
RESPONSE: Admit the truth of the allegations contained in Paragraph “13” of the Counterclaims
to the extent they allege that venue is proper in Nassau County, and deny knowledge and
information sufficient to form an opinion as to the truth of the remaining allegations set forth
therein.
FACTUAL ALLEGATIONS
A. xxxx xxxxx Creates A Life in America For His Brother
14. xxxx xxxxx (“xxxx”) arrived in the United States in 1975, nearly two decades
before his brother xxxxxx did. Prior to xxxxxx’s immigration to the U.S., xxxx worked tirelessly
to build a life for himself and his family.
RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of
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the allegations contained in paragraph “14” of the Complaint, except admit that xxxx arrived in
the United States before his brother xxxxxx did.
15. xxxx and xxxxxxx were married in 1986, and subsequently had three children,
Jordan, Jared, and Alexa.
RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of
the allegations contained in paragraph “15” of the Complaint
16. xxxx was an enormously energetic and entrepreneurial person. Through his hard
work and skill, he created or invested in numerous businesses, including liquor stores, dry cleaners,
laundromats and real estate development.
RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of
the allegations contained in paragraph “16” of the Counterclaims.
17. xxxx loved his brother xxxxxx very much, and in anticipation of xxxxxx emigrating
to the United States, xxxx sought to do everything possible to help his brother get a sound footing
in this country.
RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of
the allegations contained in paragraph “17” of the Counterclaims.
18. xxxx purchased and opened a liquor store in 1994, in Port Washington, New York
for xxxxxx and xxxxxx’s brother-in-law – over two years before xxxxxx emigrated to the United
States.
RESPONSE: Deny the truth of the allegations contained in Paragraph “18” of the Counterclaims.
19. In or about 1996, xxxxxx sought to emigrate to the United States from his then
home in Shiraz, Iran. xxxxxx spoke no English, had no connections other than xxxx in this country,
had no marketable skills and had a 12th grade education.
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RESPONSE: Deny the truth of the allegations contained in Paragraph “19” of the Counterclaims.
20. xxxx helped to purchase a second liquor store for xxxxxx, assisted xxxxxx with
obtaining loans, hiring staff for the second store as well as the original store established prior to
xxxxxx emigrating to the United States.
RESPONSE: Deny the truth of the allegations contained in Paragraph “20” of the Counterclaims.
21. xxxx did everything possible to help his brother, including finding him a home,
helping him establish credit, and providing xxxxxx with a job, and then a business.
RESPONSE: Deny the truth of the allegations contained in Paragraph “21” of the Counterclaims.
22. Given xxxx’s history of successfully owning a liquor store, he sought to find a
suitable location for a new liquor store that xxxxxx could operate. xxxx owned several businesses
for years in Long Island and Queens, including several dry-cleaning businesses.
RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of
the allegations contained in paragraph “22” of the Counterclaims.
23. On August 8, 1996, xxxx incorporated Rockville Corp.
RESPONSE: Deny the truth of the allegations contained in Paragraph “23” of the Counterclaims,
except admit that both Plaintiff and xxxx incorporated Rockville Corp.
24. This was prior to xxxxxx’s arrival in the United States.
RESPONSE: Deny the truth of the allegations contained in Paragraph “24” of the Counterclaims.
25. xxxxxx had no role whatsoever in setting up, owning, funding, financing, or
managing Rockville Corp. xxxx alone handled all of that during his life, with the assistance of
xxxx’s chosen lawyer and accounting firm.
RESPONSE: Deny the truth of the allegations contained in Paragraph “25” of the Counterclaims.
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26. On January 17, 1997, Rockville, under xxxx’s sole ownership and direction,
purchased 172 Sunrise Highway in Rockville Centre, New York (the “Property”). xxxx obtained
financing for the purchase, which was guaranteed personally by both xxxx and xxxxxxx.
RESPONSE: Deny the truth of the allegations contained in Paragraph “26” of the Counterclaims,
except admit that Rockville purchased 172 Sunrise Highway in Rockville Centre, New York and
xxxx signed the mortgage documents on behalf of Rockville.
27. As of early 1997, xxxx was the 100% owner of Rockville, and Rockville’s sole
asset was the Property, which was subject to a mortgage that xxxx and xxxxxxx personally
guaranteed.
RESPONSE: Deny the truth of the allegations contained in Paragraph “27” of the Counterclaims,
except admit that Rockville’s sole asset was the Property.
28. xxxxxx owned no part of Rockville, and had no role whatsoever in obtaining the
financing for or guaranteeing the mortgage on, the Property
RESPONSE: Deny the truth of the allegations contained in Paragraph “28” of the Counterclaims.
B. The Liquor Store Business And The “Sweetheart” Deal for xxxxxx
29. Given xxxx’s desire to help plaintiff to establish himself in this Country, and to set
plaintiff up in a business he could use to support himself and others, xxxx decided he would give
his brother a “sweetheart” deal in which to run a new liquor store – Bargain Liquors.
RESPONSE: Deny the truth of the allegations contained in Paragraph “29” of the Counterclaims.
30. Having established Rockville with his own money, and having purchased the
Property with his own money, xxxx decided to assist his brother in setting up Bargain Liquors, so
xxxxxx could own and operate it.
RESPONSE: Deny the truth of the allegations contained in Paragraph “30” of the Counterclaims.
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31. xxxx assisted xxxxxx in incorporating Bargain Liquors, and in financing its
operations.
RESPONSE: Deny the truth of the allegations contained in Paragraph “31” of the Counterclaims.,
except that xxxx assisted xxxxxx in obtaining financing.
32. The brothers agreed that although xxxxxx would be the owner of Bargain Liquors,
and had no ownership of Rockville, because Rockville was giving xxxxxx free use of the Property,
Bargain Liquors would pay all real estate and other property-related taxes on the Property, and
would pay xxxx on an annual basis 20% of the net profits of Bargain Liquors.
RESPONSE: Deny the truth of the allegations contained in Paragraph “32” of the Counterclaims.
33. Bargain Liquors has never been part of Rockville.
RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of
the allegations contained in paragraph “33” of the Counterclaims, except admit that Bargain
Liquors is not a shareholder of Rockville and Rockville is not a shareholder of Bargain Liquors.
34. Rockville has never been part of Bargain Liquors.
RESPONSE: Admit the truth of the allegations contained in Paragraph “34” of the Counterclaims.
35. They are separate corporations with separate assets, from inception to the present.
RESPONSE: Admit the truth of the allegations contained in Paragraph “35” of the Counterclaims.
36. As a result of xxxx’s generosity to xxxxxx, which xxxxxx repeatedly
acknowledged, xxxxxx was able to make an excellent living, and has had a thriving liquor store
business for which he effectively pays no rent for the past 25 years.
RESPONSE: Deny the truth of the allegations contained in Paragraph “36” of the Counterclaims.
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37. On December, 8 2000, Rockville, under xxxx’s sole ownership and direction,
purchased 172 Sunrise Highway in Rockville Centre, New York – the adjoining lot to the
previously purchased 170 Sunrise Highway.
RESPONSE: Deny the truth of the allegations contained in Paragraph “37” of the Counterclaims.
38. On March 1, 2006, Rockville Corp. obtained a mortgage for 170-72 Sunrise
Highway from Cross County Federal Savings Bank for $900,000. As part of that mortgage, xxxx
signed all of the documents on behalf of Rockville Corp. – as President and with our personal
residence listed as the address for Rockville Corp. – and xxxx personally guaranteed the loan.
RESPONSE: Deny the truth of the allegations contained in Paragraph “38” of the Counterclaims,
except admit that Rockville Corp. obtained a mortgage from Cross County Federal Savings Bank
for $900,000 and xxxx signed the mortgage documents on behalf of Rockville Corp.
39. Nearly the entirety of the funds from this $900,000 mortgage went to xxxxxx to
help him purchase a new home for his family and help cover his living expenses.
RESPONSE: Deny the truth of the allegations contained in Paragraph “39” of the Counterclaims.
40. As this mortgage was entirely for xxxxxx’s benefit, he agreed to remit to xxxx and
the mortgage borrower, Rockville, payments from the operations of Bargain Liquors sufficient to
cover the mortgage payments.
RESPONSE: Deny the truth of the allegations contained in Paragraph “40” of the Counterclaims.
41. On advice of their accountant, xxxx and xxxxxxx reported these payments as
commercial rent, as reporting was required. As a result, xxxx during his life, and then xxxxxxx,
received K-1s from Rockville recording the receipt of this rental income, and they, alone, have
paid income taxes on Rockville’s annual net profit resulting from this phantom “rental income.”
RESPONSE: Deny the truth of the allegations contained in paragraph “41” of the Counterclaims.
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42. Rockville produced the Schedule K-1’s because it is a Subchapter-S corporate tax
filer, and such schedules were required to show the ownership structure of the corporation for tax
filing purposes throughout the entirety of its existence.
RESPONSE: Paragraph “42” of the Counterclaims proffers a legal conclusion, to which a
response is not required. To the extent a response is called for, Counterclaim-Defendants deny the
truth of the allegations contained in Paragraph “42” of the Counterclaims.
43. At all times before xxxx’s death, he was always listed in those documents as the
100% owner of Rockville, and accordingly, was solely responsible for its tax obligations, which
he timely paid.
RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of
the allegations contained in paragraph “43” of the Counterclaims.
44. Moreover, Rockville’s tax returns consistently showed that it had no goods sold –
indicating it is not a part of the liquor store business – and instead, its only source of income is
from real estate, as the Property is its sole asset.
RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of
the allegations contained in paragraph “44” of the Counterclaims.
C. xxxx’s Death
45. On March 10, 2008 xxxx passed away at age 53, as the result of metastatic
appendiceal cancer.
RESPONSE: Admit the truth of the allegations contained in Paragraph “45” of the Counterclaims.
46. Surviving xxxx were xxxxxxx, then age 41, and their three children, Jordan, then
16, Jared, then 11, and Alexa, then 9.
RESPONSE: Admit the truth of the allegations contained in Paragraph “46” of the Counterclaims.
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47. At the time of his passing, xxxx continued to own 100% of Rockville.
RESPONSE: Deny the truth of the allegations contained in Paragraph “47” of the Counterclaims.
48. Pursuant to his will, xxxx expressly passed that 100% interest in Rockville to
xxxxxxx as his beneficiary.
RESPONSE: Deny the truth of the allegations contained in Paragraph “48” of the Counterclaims.
49. The 100% interest in Rockville was listed as one of xxxx’s assets as part of his
estate.
RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of
the allegations contained in paragraph “49” of the Counterclaims.
50. Neither xxxxxx, nor anyone else, challenged or contested xxxxxxx’s inheritance of
all right, title and interest in 100% of Rockville.
RESPONSE: Deny the truth of the allegations contained in Paragraph “50” of the Counterclaims.
51. Never, until this lawsuit, has xxxxxx contended – falsely – that he is an 80% owner
of Rockville.
RESPONSE: Deny the truth of the allegations contained in Paragraph “51” of the Counterclaims.
52. xxxxxx does not own any part of Rockville.
RESPONSE: Deny the truth of the allegations contained in Paragraph “52” of the Counterclaims.
53. xxxxxx has never paid any of the income taxes due on Rockville’s profits because
he has never had any ownership of any part of that corporation.
RESPONSE: Deny the truth of the allegations contained in Paragraph “53” of the Counterclaims.
54. xxxxxxx has maintained 100% ownership of Rockville, except for a short period of
time when Rockville was inadvertently placed into xxxx’s testamentary trust.
RESPONSE: Deny the truth of the allegations contained in Paragraph “54” of the Counterclaims.
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55. All of the K-1s for Rockville since xxxx’s death show xxxxxxx as the 100% owner
of the corporation, and accordingly, she alone has been responsible for its tax obligations, which
she has timely paid.
RESPONSE: Deny the truth of allegations contained in paragraph “55” of the Counterclaims.
56. Thus, at all times since its inception, Rockville has owned one asset – the Property
– and has only ever had a single 100% shareholder: xxxx, then xxxxxxx.
RESPONSE: Deny the truth of the allegations contained in Paragraph “56” of the Counterclaims,
except admit that at all times since its inception, Rockville has owned one asset – the Property.
D. xxxxxxx Stops Receiving Her Profit Share Payments, And xxxxxx’s Continued
Misuse of Bargain Liquors’ Funds
57. xxxx and xxxxxx each performed according to their verbal agreement – that in
exchange for Rockville giving xxxxxx free use of the Property, Bargain Liquors would pay all real
estate and other property-related taxes on the Property, and would pay xxxx on an annual basis
20% of the net profit of Bargain Liquors – up to xxxx’s untimely death from cancer in 2008.
RESPONSE: Deny the truth of the allegations contained in Paragraph “57” of the Counterclaims.
58. Following xxxx’s death and through approximately 2013, xxxxxx continued to
make annual payments to xxxxxxx of her share (as successor to xxxx’s interest) of what xxxxxx
alleged was 20% of the net profits of Bargain Liquors.
RESPONSE: Deny the truth of the allegations contained in Paragraph “58” of the Counterclaims.
59. After 2013, however, xxxxxx stopped making the 20% payments owed to xxxxxxx
from the profits from Bargain Liquors.
RESPONSE: Deny the truth of the allegations contained in Paragraph “59” of the Counterclaims.
60. Despite the payments having stopped, Bargain Liquors has continued to exploit the
rent-free use of Rockville’s Property.
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RESPONSE: Deny the truth of the allegations contained in Paragraph “60” of the Counterclaims.
61. Each year, xxxxxx made new excuses as to why the business was not profitable,
and thus there were allegedly no funds to distribute to xxxxxxx.
RESPONSE: Deny the truth of the allegations contained in Paragraph “61” of the Counterclaims.
62. At the same time, xxxxxx proceeded to siphon off money from the business,
including by putting numerous members of his family on payroll at Bargain Liquors, despite none
of them actually working there. Additionally, those family members receive healthcare benefits at
the expense of Bargain Liquors despite the fact that they are not, in fact, actual employees of the
business.
RESPONSE: Deny the truth of the allegations contained in Paragraph “62” of the Counterclaims.
63. Moreover, xxxxxx and Bargain Liquors consistently have falsely under-reported
the profits of Bargain Liquors in tax returns and other filings.
RESPONSE: Deny the truth of the allegations contained in Paragraph “63” of the Counterclaims.
64. xxxxxx and Bargain Liquors have also falsely and grossly underreported in tax
returns and other filings the amount of cash income that Bargain Liquors takes in year after year.
RESPONSE: Deny the truth of the allegations contained in Paragraph “64” of the Counterclaims.
65. As part of that scheme, xxxxxx and Bargain Liquors have falsified inventory reports
for Bargain Liquors.
RESPONSE: Deny the truth of the allegations contained in Paragraph “65” of the Counterclaims.
66. These schemes, aside from being unlawful, have deprived xxxxxxx of her rightful
20% share of Bargain Liquors’ profits.
RESPONSE: Deny the truth of the allegations contained in Paragraph “66” of the Counterclaims.
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67. Additionally, xxxxxx, in violation of New York Law and regulation – has failed to
disclose to the New York Liquor Authority that xxxx had, and xxxxxxx has, a 20% interest in
Bargain Liquor’s profits.
RESPONSE: Deny the truth of the allegations contained in Paragraph “67” of the Counterclaims.
68. xxxxxx’s and Bargain Liquors’ foregoing falsification of records, false tax
reporting, false employee reporting, false medical plan reporting, false Liquor Authority reporting,
and other wrongdoing, threaten the imminent loss of Bargain Liquors’ liquor license, and the loss
of Bargain Liquors’ business.
RESPONSE: Deny the truth of the allegations contained in Paragraph “68” of the Counterclaims.
E. xxxxxx’s Bad Faith And Fraudulent Negotiations, And Interference With xxxxxxx’s
Sale Of The Property
69. Despite xxxxxx’s wrongdoing, xxxxxxx and her family members have tried to
amicably resolve their differences with respect to the liquor store by reaching an accommodation
for xxxxxx to buy xxxxxxx out of her ownership of Rockville and her interest in Bargain Liquors’
net profits, and settle all past due amounts of the profits due to xxxxxxx from Bargain Liquors.
RESPONSE: Deny the truth of the allegations contained in Paragraph “69” of the Counterclaims,
except admit that Plaintiff has engaged in negotiations to purchase xxxxxxx’s 20% interest in
Rockville Corp.
70. Unfortunately, xxxxxx has been unwilling to come to a compromise and has refused
to negotiate in good faith.
RESPONSE: Deny the truth of the allegations contained in Paragraph “70” of the Counterclaims.
71. Accordingly, xxxxxxx’s son, Jordan, began marketing the Property with the use of
a real estate broker.
RESPONSE: Admit the truth of the allegations contained in Paragraph “71” of the Counterclaims.
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72. When confronted with this, xxxxxx told xxxxxxx: “go ahead and sell it, the land is
not worth that much. I can get another property across the street for much cheaper and don’t need
that location.”
RESPONSE: Deny the truth of the allegations contained in Paragraph “72” of the Counterclaims.
73. xxxxxx thus acknowledged xxxxxxx’s complete ownership of Rockville, and
consequently the Property.
RESPONSE: Deny the truth of the allegations contained in Paragraph “73” of the Counterclaims.
74. After this conversation, the real estate broker began marketing the Property and
found a bona fide purchaser who signed a Letter of Intent for an all-cash offer of $2.2 million, and
who is seeking a quick closing.
RESPONSE: Deny the truth of the allegations contained in Paragraph “74” of the Counterclaims,
except admit that the real estate broker began marketing the Property over Plaintiff’s objection.
75. Thereafter, xxxxxx contacted the real estate broker and falsely and fraudulently
claimed, without any evidence, that Bargain Liquors had a lease for $2,000 per month with 5 to 7
years remaining for the Property.
RESPONSE: Deny the truth of the allegations contained in Paragraph “75” of the Counterclaims.
76. Despite numerous requests for proof of this “lease,” by the real estate broker, by
Jordan, and by undersigned counsel, xxxxxx has yet to produce any such claimed “lease.”
RESPONSE: Deny the truth of the allegations contained in Paragraph “76” of the Counterclaims.
77. xxxxxx’s purported claim of a “lease” for the Property is also at odds with his claims
of 80% ownership over Rockville, and in turn the Property, for if he were a majority owner of the
Rockville and the Property, he would not need to pay rent to himself for use and enjoyment of his
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property. Like xxxxxx’s many other falsehoods, his claim of a valid and enforceable written lease
is a lie.
RESPONSE: Deny the truth of the allegations contained in Paragraph “77” of the Counterclaims.
78. xxxxxx instituted this suit to interfere with the sale of the Property, and to scare off
xxxxxxx’s buyer, and deprive xxxxxxx of what she is rightfully due.
RESPONSE: Deny the truth of the allegations contained in Paragraph “78” of the Counterclaims.
DEMAND FUTILITY
79. xxxxxxx has not made any pre-counterclaim demand upon xxxxxx for a full
accounting of Bargain Liquors because such demand would be futile, as evidenced by: xxxxxx’s
refusal for more than 8 years to pay xxxxxxx the 20% of profits that is owed to her; and xxxxxx’s
bringing this action, rather than negotiating in good faith a buyout of the Property.
RESPONSE: Deny the truth of the allegations contained in Paragraph “79” of the Counterclaims.
80. Moreover, because xxxxxx has intentionally attempted to conflate Rockville with
Bargain Liquors and instead claim an 80% ownership over these separately owned entities, and
because xxxxxx is accused of misusing the corporate entity and falsifying records, xxxxxx does
not possess the requisite books and records for a complete accounting of Bargain Liquors profits.
RESPONSE: Deny the truth of the allegations contained in Paragraph “80” of the Counterclaims.
FIRST COUNTERCLAIM
(TORTIOUS INTERFERENCE WITH PROSPECTIVE BUSINESS ADVANTAGE
AGAINST xxxxxx)
81. xxxxxxx and Rockville repeat and re-allege each and every allegation contained in
paragraphs 1 through 80 of the Counterclaims.
RESPONSE: Paragraph “81” of the Counterclaims is not an allegation to which a response is
required.
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82. In early 2022, after failed negotiations with xxxxxx to buy out xxxxxxx’s interest in
Bargain Liquors or purchase the Property from Rockville, xxxxxxx, with the help of her son and
his selected real estate agent, sought to market the Property for sale.
RESPONSE: Deny the truth of the allegations contained in Paragraph “82” of the Counterclaims,
except admit that xxxxxxx, with the help of her son, sought to market the Property for Sale.
83. The real estate broker found a bona fide purchaser who signed a Letter of Intent for
an all-cash offer of $2.2 million for the Property.
RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of
the allegations contained in paragraph “83” of the Complaint.
84. When xxxxxx learned about this impending sale, he made several attempts to
disrupt and interfere with this relationship, including by falsely claiming he had a 5 to 7 year
severely-below-market lease for the Property, and by filing this lawsuit to enjoin and stop xxxxxxx
from selling her property.
RESPONSE: Deny the truth of the allegations contained in Paragraph “84” of the Counterclaims.
85. xxxxxx’s lawsuit is premised on the false allegation that he owns 80% of Rockville
– an allegation he knows is false, and was intended only to disrupt xxxxxxx’s sale of the Property.
RESPONSE: Deny the truth of the allegations contained in Paragraph “85” of the Counterclaims.
86. Because of xxxxxx’s lawsuit, and the preliminary injunction he obtained, he has
succeeded in interfering with xxxxxxx’s and Rockville’s relationship with the prospective buyer,
and they have been unable to effect the sale of her Property.
RESPONSE: Deny the truth of the allegations contained in Paragraph “86” of the Counterclaims.
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87. As a direct and proximate result cause of xxxxxx’s wrongdoing, xxxxxxx and
Rockville have been harmed in an amount to be determined at trial, but not less than $2,200,000
plus interest.
RESPONSE: Paragraph “87” of the Counterclaims proffers a legal conclusion, to which a
response is not required. To the extent a response is called for, Counterclaim-Defendants deny the
truth of the allegations contained therein, and otherwise respectfully refers all such questions of
law to the Court.
SECOND COUNTERCLAIM
(BREACH OF CONTRACT)
88. xxxxxxx repeats and re-alleges each and every allegation contained in paragraphs 1
through 87 of the Counterclaims.
RESPONSE: Paragraph “88” of the Counterclaims is not an allegation to which a response is
required.
89. As part of xxxx and xxxxxx’s agreement for Bargain Liquors’ free use of the
Property, it was agreed that Bargain Liquors would pay all real estate and other property-related
taxes on the Property, and would pay xxxx (and later xxxxxxx) on an annual basis 20% of the net
profits of Bargain Liquor.
RESPONSE: Deny the truth of the allegations contained in Paragraph “89” of the Counterclaims.
90. xxxx and xxxxxx each performed according to their verbal agreement up to xxxx’s
untimely death from cancer in 2008.
RESPONSE: Deny the truth of the allegations contained in Paragraph “90” of the Counterclaims.
91. Following
Preview
FILED: NASSAU COUNTY CLERK 02/13/2023 05:22 PM INDEX NO. 607197/2022 NYSCEF DOC. NO. 89 RECEIVED NYSCEF: 02/13/2023 Exhibit C 11/14/2022 05:22 FILED: NASSAU COUNTY CLERK 02/13/2023 11:58 PM AM INDEX NO. 607197/2022 80 NYSCEF DOC. NO. 89 11/14/2022 RECEIVED NYSCEF: 02/13/2023 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NASSAU xxxxxx xxxxxx a/k/a xxxxxxxxxx xxxxxx, individually and derivatively on behalf of ROCKVILLE CORP., Index No.: 607197/2022 Plaintiff, Hon. Sharon M.J. Gianelli -against- COUNTERCLAIM- DEFENDANTS’ REPLY TO xxxxxxx xxxxx, individually and as the DEFENDANT xxxxxxx executor of the Estate of xxxx xxxxx, and as xxxxx’S COUNTERCLAIMS co-trustee of the disclaimer Trust under Article “Fourth” of the Last Will and Testament of xxxx xxxxx; MAKAN DELRAHIM, as former co-trustee of the disclaimer Trust under Article “Fourth” of the Last Will and Testament of xxxx xxxxx; and BAHARAK AMIRIAN as co-trustee of the disclaimer Trust under the Last Will and Testament of xxxx xxxxx, Defendants, -and- ROCKVILLE CORP. Nominal Defendant. xxxxxxx xxxxx and ROCKVILLE CORP., Counterclaim-Plaintiffs -against- xxxxxx xxxxxx and 172 BARGAIN LIQUORS INC. Counterclaim-Defendants. 1 of 26 11/14/2022 05:22 FILED: NASSAU COUNTY CLERK 02/13/2023 11:58 PM AM INDEX NO. 607197/2022 80 NYSCEF DOC. NO. 89 11/14/2022 RECEIVED NYSCEF: 02/13/2023 Plaintiff and counterclaim-defendant, xxxxxx xxxxxx a/k/a xxxxxxxxxx xxxxxx, individually and derivatively on behalf of Rockville Corp. (“Plaintiff”), and counterclaim- defendant 172 BARGAIN LIQUORS INC. (“Bargain Liquors”, collectively “Counterclaim- Defendants”) by their attorneys, Ruskin Moscou Faltischek, P.C., as and for their reply to defendant xxxxxxx xxxxx’s (“Defendant” or “xxxxxxx”) Answer to the Complaint and Counterclaims, dated October 24, 2022 (“Counterclaims”), allege as follows: COUNTERCLAIMS NATURE OF THE ACTION 1. These Counterclaims arise from xxxxxx’s despicable bad faith actions towards his late brother’s widow, xxxxxxx and her family, including xxxxxx’s failure to pay millions of dollars that xxxxxx owes to xxxxxxx, his failure to negotiate in good faith a resolution of his debt to xxxxxxx, his fraudulent and coercive tactics to block a sale of xxxxxxx’s property, and his filing of his suit seeking to wrongfully obtain an 80% interest in that property. xxxxxx’s actions have brought shame upon him and his family, as his and their conduct demonstrate the height of ingratitude and disrespect for xxxx’s and xxxxxxx’s more than three decades of providing financial and every other kind of help to xxxxxx and his family. This is another terrible example of no good deed by xxxx and xxxxxxx towards xxxxxx going unpunished. RESPONSE: Deny the allegations contained in paragraph “1” of the Counterclaims. 2. The allegations in xxxxxx’s Complaint present a completely false version of history. xxxxxx asserts – with no proof whatsoever – that he owns 80% of Rockville, and therefore, has the right to block Counterclaim-Plaintiff xxxxxxx xxxxx’s sale of Rockville’s sole asset – property on Sunrise Highway in Rockville Centre, New York. 2 2 of 26 11/14/2022 05:22 FILED: NASSAU COUNTY CLERK 02/13/2023 11:58 PM AM INDEX NO. 607197/2022 80 NYSCEF DOC. NO. 89 11/14/2022 RECEIVED NYSCEF: 02/13/2023 RESPONSE: Deny the allegations contained in paragraph “2” of the Counterclaims, except admit that Rockville’s sole asset is real property located at 172 Sunrise Highway, Rockville Centre, New York and surrounding lots s (Section 38; Block: 317; Lot 130, 359 and 369). 3. xxxxxx’s claims of such ownership are false. As set forth more fully herein, there is no question that Rockville is 100% owned by xxxxxxx, and has for the entirety of its existence – over 25 years – been owned entirely by xxxxxxx’s late husband, xxxx, and then passed through his will to xxxxxxx. RESPONSE: Deny the allegations contained in paragraph “3” of the Counterclaims. 4. xxxxxxx’s 100% ownership of Rockville is conclusively established by contemporaneous corporate documents, estate filings, K-1s showing that xxxx was 100% owner before his death in 2008, and then K-1s showing xxxxxxx has been 100% owner of Rockville since 2008. Indeed, for 25 years, xxxx and then xxxxxxx, have filed tax returns for Rockville reflecting their 100% ownership, and have personally paid income taxes on Rockville’s earnings. RESPONSE: Deny the allegations contained in paragraph “4” of the Counterclaims. 5. xxxxxx’s claim that he is 80% owner of Rockville is therefore conclusively refuted by 25 years of corporate filings, tax filings, and other documentary proof. RESPONSE: Deny the allegations contained in paragraph “5” of the Counterclaims. 6. xxxxxx is wrongfully trying to strongarm his late brother’s widow by scuttling her attempts to sell her property, wrongfully and fraudulently attempting to claim ownership over the corporation she inherited from her late husband, and wrongfully withholding money from, and unjustly enriching himself at the expense of, his late brother’s widow. RESPONSE: Deny the allegations contained in paragraph “6” of the Counterclaims. 3 3 of 26 11/14/2022 05:22 FILED: NASSAU COUNTY CLERK 02/13/2023 11:58 PM AM INDEX NO. 607197/2022 80 NYSCEF DOC. NO. 89 11/14/2022 RECEIVED NYSCEF: 02/13/2023 7. Through these counterclaims, xxxxxxx and Rockville seek (i) monetary damages arising from xxxxxx’s improper blocking of the sale of xxxxxxx’s property; (ii) monetary damages arising from xxxxxx’s improper withholding of the 20% of profits from Bargain Liquors due and owing to xxxxxxx; (iii) an accounting of Bargain Liquors’ books and records, tax returns and other documents, to which xxxxxxx holds a 20% interest; (iv) appointment of a receiver for Bargain Liquors’ funds and property in order to preserve them and prevent any further loss for xxxxxxx until this Court has fully determined, and Counterclaim-Defendants have fully satisfied, the amount due and owing to her; and (v) an order declaring xxxxxxx is 100% owner of Rockville and Rockville’s property in Rockville Centre. RESPONSE: Paragraph “7” of the Counterclaims is not an allegation to which a response is required. To the extent a response is called for, Counterclaim-Defendants deny the truth of the allegations therein. PARTIES 8. Counterclaim-Plaintiff xxxxxxx xxxxx resides in the Nassau County, New York. RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of the allegations contained in paragraph “8” of the Counterclaims, except avers, upon information and belief, that xxxxxxx xxxxx resides in Nassau County. 9. Counterclaim-Plaintiff Rockville Corporation is a domestic corporation formed under the laws of the State of New York, with its principal place of business located at 26 Sandpiper Court, Old Westbury, New York 11568. RESPONSE: Deny the allegations contained in paragraph “9” of the Counterclaims. 10. Upon information and belief, Counterclaim-Defendant xxxxxx xxxxxx is a natural person residing at 5 Copperfield Lane, Old Westbury, New York 11568. 4 4 of 26 11/14/2022 05:22 FILED: NASSAU COUNTY CLERK 02/13/2023 11:58 PM AM INDEX NO. 607197/2022 80 NYSCEF DOC. NO. 89 11/14/2022 RECEIVED NYSCEF: 02/13/2023 RESPONSE: Admit the truth of the allegations contained in Paragraph “10” of the Counterclaims. 11. Upon information and belief, Counterclaim-Defendant 172 Bargain Liquors is a domestic corporation formed under the laws of the State of New York, with its principal place of business located at 172 Sunrise Highway, Rockville Centre, New York 11570. RESPONSE: Admit the truth of the allegations contained in Paragraph “11” of the Counterclaims. JURISDICTION AND VENUE 12. This Court has jurisdiction over this proceeding on the grounds that: (i) this action arises out of the same or similar occurrences as alleged in the Complaint; and (ii) pursuant to CPLR § 301, as the Counterclaim-Defendants reside in the State of New York. RESPONSE: Admit the truth of the allegations contained in Paragraph “12” of the Counterclaims. 13. Venue is appropriate pursuant to CPLR §§ 503(a) & (c), as all parties reside in this county. RESPONSE: Admit the truth of the allegations contained in Paragraph “13” of the Counterclaims to the extent they allege that venue is proper in Nassau County, and deny knowledge and information sufficient to form an opinion as to the truth of the remaining allegations set forth therein. FACTUAL ALLEGATIONS A. xxxx xxxxx Creates A Life in America For His Brother 14. xxxx xxxxx (“xxxx”) arrived in the United States in 1975, nearly two decades before his brother xxxxxx did. Prior to xxxxxx’s immigration to the U.S., xxxx worked tirelessly to build a life for himself and his family. RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of 5 5 of 26 11/14/2022 05:22 FILED: NASSAU COUNTY CLERK 02/13/2023 11:58 PM AM INDEX NO. 607197/2022 80 NYSCEF DOC. NO. 89 11/14/2022 RECEIVED NYSCEF: 02/13/2023 the allegations contained in paragraph “14” of the Complaint, except admit that xxxx arrived in the United States before his brother xxxxxx did. 15. xxxx and xxxxxxx were married in 1986, and subsequently had three children, Jordan, Jared, and Alexa. RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of the allegations contained in paragraph “15” of the Complaint 16. xxxx was an enormously energetic and entrepreneurial person. Through his hard work and skill, he created or invested in numerous businesses, including liquor stores, dry cleaners, laundromats and real estate development. RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of the allegations contained in paragraph “16” of the Counterclaims. 17. xxxx loved his brother xxxxxx very much, and in anticipation of xxxxxx emigrating to the United States, xxxx sought to do everything possible to help his brother get a sound footing in this country. RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of the allegations contained in paragraph “17” of the Counterclaims. 18. xxxx purchased and opened a liquor store in 1994, in Port Washington, New York for xxxxxx and xxxxxx’s brother-in-law – over two years before xxxxxx emigrated to the United States. RESPONSE: Deny the truth of the allegations contained in Paragraph “18” of the Counterclaims. 19. In or about 1996, xxxxxx sought to emigrate to the United States from his then home in Shiraz, Iran. xxxxxx spoke no English, had no connections other than xxxx in this country, had no marketable skills and had a 12th grade education. 6 6 of 26 11/14/2022 05:22 FILED: NASSAU COUNTY CLERK 02/13/2023 11:58 PM AM INDEX NO. 607197/2022 80 NYSCEF DOC. NO. 89 11/14/2022 RECEIVED NYSCEF: 02/13/2023 RESPONSE: Deny the truth of the allegations contained in Paragraph “19” of the Counterclaims. 20. xxxx helped to purchase a second liquor store for xxxxxx, assisted xxxxxx with obtaining loans, hiring staff for the second store as well as the original store established prior to xxxxxx emigrating to the United States. RESPONSE: Deny the truth of the allegations contained in Paragraph “20” of the Counterclaims. 21. xxxx did everything possible to help his brother, including finding him a home, helping him establish credit, and providing xxxxxx with a job, and then a business. RESPONSE: Deny the truth of the allegations contained in Paragraph “21” of the Counterclaims. 22. Given xxxx’s history of successfully owning a liquor store, he sought to find a suitable location for a new liquor store that xxxxxx could operate. xxxx owned several businesses for years in Long Island and Queens, including several dry-cleaning businesses. RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of the allegations contained in paragraph “22” of the Counterclaims. 23. On August 8, 1996, xxxx incorporated Rockville Corp. RESPONSE: Deny the truth of the allegations contained in Paragraph “23” of the Counterclaims, except admit that both Plaintiff and xxxx incorporated Rockville Corp. 24. This was prior to xxxxxx’s arrival in the United States. RESPONSE: Deny the truth of the allegations contained in Paragraph “24” of the Counterclaims. 25. xxxxxx had no role whatsoever in setting up, owning, funding, financing, or managing Rockville Corp. xxxx alone handled all of that during his life, with the assistance of xxxx’s chosen lawyer and accounting firm. RESPONSE: Deny the truth of the allegations contained in Paragraph “25” of the Counterclaims. 7 7 of 26 11/14/2022 05:22 FILED: NASSAU COUNTY CLERK 02/13/2023 11:58 PM AM INDEX NO. 607197/2022 80 NYSCEF DOC. NO. 89 11/14/2022 RECEIVED NYSCEF: 02/13/2023 26. On January 17, 1997, Rockville, under xxxx’s sole ownership and direction, purchased 172 Sunrise Highway in Rockville Centre, New York (the “Property”). xxxx obtained financing for the purchase, which was guaranteed personally by both xxxx and xxxxxxx. RESPONSE: Deny the truth of the allegations contained in Paragraph “26” of the Counterclaims, except admit that Rockville purchased 172 Sunrise Highway in Rockville Centre, New York and xxxx signed the mortgage documents on behalf of Rockville. 27. As of early 1997, xxxx was the 100% owner of Rockville, and Rockville’s sole asset was the Property, which was subject to a mortgage that xxxx and xxxxxxx personally guaranteed. RESPONSE: Deny the truth of the allegations contained in Paragraph “27” of the Counterclaims, except admit that Rockville’s sole asset was the Property. 28. xxxxxx owned no part of Rockville, and had no role whatsoever in obtaining the financing for or guaranteeing the mortgage on, the Property RESPONSE: Deny the truth of the allegations contained in Paragraph “28” of the Counterclaims. B. The Liquor Store Business And The “Sweetheart” Deal for xxxxxx 29. Given xxxx’s desire to help plaintiff to establish himself in this Country, and to set plaintiff up in a business he could use to support himself and others, xxxx decided he would give his brother a “sweetheart” deal in which to run a new liquor store – Bargain Liquors. RESPONSE: Deny the truth of the allegations contained in Paragraph “29” of the Counterclaims. 30. Having established Rockville with his own money, and having purchased the Property with his own money, xxxx decided to assist his brother in setting up Bargain Liquors, so xxxxxx could own and operate it. RESPONSE: Deny the truth of the allegations contained in Paragraph “30” of the Counterclaims. 8 8 of 26 11/14/2022 05:22 FILED: NASSAU COUNTY CLERK 02/13/2023 11:58 PM AM INDEX NO. 607197/2022 80 NYSCEF DOC. NO. 89 11/14/2022 RECEIVED NYSCEF: 02/13/2023 31. xxxx assisted xxxxxx in incorporating Bargain Liquors, and in financing its operations. RESPONSE: Deny the truth of the allegations contained in Paragraph “31” of the Counterclaims., except that xxxx assisted xxxxxx in obtaining financing. 32. The brothers agreed that although xxxxxx would be the owner of Bargain Liquors, and had no ownership of Rockville, because Rockville was giving xxxxxx free use of the Property, Bargain Liquors would pay all real estate and other property-related taxes on the Property, and would pay xxxx on an annual basis 20% of the net profits of Bargain Liquors. RESPONSE: Deny the truth of the allegations contained in Paragraph “32” of the Counterclaims. 33. Bargain Liquors has never been part of Rockville. RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of the allegations contained in paragraph “33” of the Counterclaims, except admit that Bargain Liquors is not a shareholder of Rockville and Rockville is not a shareholder of Bargain Liquors. 34. Rockville has never been part of Bargain Liquors. RESPONSE: Admit the truth of the allegations contained in Paragraph “34” of the Counterclaims. 35. They are separate corporations with separate assets, from inception to the present. RESPONSE: Admit the truth of the allegations contained in Paragraph “35” of the Counterclaims. 36. As a result of xxxx’s generosity to xxxxxx, which xxxxxx repeatedly acknowledged, xxxxxx was able to make an excellent living, and has had a thriving liquor store business for which he effectively pays no rent for the past 25 years. RESPONSE: Deny the truth of the allegations contained in Paragraph “36” of the Counterclaims. 9 9 of 26 11/14/2022 05:22 FILED: NASSAU COUNTY CLERK 02/13/2023 11:58 PM AM INDEX NO. 607197/2022 80 NYSCEF DOC. NO. 89 11/14/2022 RECEIVED NYSCEF: 02/13/2023 37. On December, 8 2000, Rockville, under xxxx’s sole ownership and direction, purchased 172 Sunrise Highway in Rockville Centre, New York – the adjoining lot to the previously purchased 170 Sunrise Highway. RESPONSE: Deny the truth of the allegations contained in Paragraph “37” of the Counterclaims. 38. On March 1, 2006, Rockville Corp. obtained a mortgage for 170-72 Sunrise Highway from Cross County Federal Savings Bank for $900,000. As part of that mortgage, xxxx signed all of the documents on behalf of Rockville Corp. – as President and with our personal residence listed as the address for Rockville Corp. – and xxxx personally guaranteed the loan. RESPONSE: Deny the truth of the allegations contained in Paragraph “38” of the Counterclaims, except admit that Rockville Corp. obtained a mortgage from Cross County Federal Savings Bank for $900,000 and xxxx signed the mortgage documents on behalf of Rockville Corp. 39. Nearly the entirety of the funds from this $900,000 mortgage went to xxxxxx to help him purchase a new home for his family and help cover his living expenses. RESPONSE: Deny the truth of the allegations contained in Paragraph “39” of the Counterclaims. 40. As this mortgage was entirely for xxxxxx’s benefit, he agreed to remit to xxxx and the mortgage borrower, Rockville, payments from the operations of Bargain Liquors sufficient to cover the mortgage payments. RESPONSE: Deny the truth of the allegations contained in Paragraph “40” of the Counterclaims. 41. On advice of their accountant, xxxx and xxxxxxx reported these payments as commercial rent, as reporting was required. As a result, xxxx during his life, and then xxxxxxx, received K-1s from Rockville recording the receipt of this rental income, and they, alone, have paid income taxes on Rockville’s annual net profit resulting from this phantom “rental income.” RESPONSE: Deny the truth of the allegations contained in paragraph “41” of the Counterclaims. 10 10 of 26 11/14/2022 05:22 FILED: NASSAU COUNTY CLERK 02/13/2023 11:58 PM AM INDEX NO. 607197/2022 80 NYSCEF DOC. NO. 89 11/14/2022 RECEIVED NYSCEF: 02/13/2023 42. Rockville produced the Schedule K-1’s because it is a Subchapter-S corporate tax filer, and such schedules were required to show the ownership structure of the corporation for tax filing purposes throughout the entirety of its existence. RESPONSE: Paragraph “42” of the Counterclaims proffers a legal conclusion, to which a response is not required. To the extent a response is called for, Counterclaim-Defendants deny the truth of the allegations contained in Paragraph “42” of the Counterclaims. 43. At all times before xxxx’s death, he was always listed in those documents as the 100% owner of Rockville, and accordingly, was solely responsible for its tax obligations, which he timely paid. RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of the allegations contained in paragraph “43” of the Counterclaims. 44. Moreover, Rockville’s tax returns consistently showed that it had no goods sold – indicating it is not a part of the liquor store business – and instead, its only source of income is from real estate, as the Property is its sole asset. RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of the allegations contained in paragraph “44” of the Counterclaims. C. xxxx’s Death 45. On March 10, 2008 xxxx passed away at age 53, as the result of metastatic appendiceal cancer. RESPONSE: Admit the truth of the allegations contained in Paragraph “45” of the Counterclaims. 46. Surviving xxxx were xxxxxxx, then age 41, and their three children, Jordan, then 16, Jared, then 11, and Alexa, then 9. RESPONSE: Admit the truth of the allegations contained in Paragraph “46” of the Counterclaims. 11 11 of 26 11/14/2022 05:22 FILED: NASSAU COUNTY CLERK 02/13/2023 11:58 PM AM INDEX NO. 607197/2022 80 NYSCEF DOC. NO. 89 11/14/2022 RECEIVED NYSCEF: 02/13/2023 47. At the time of his passing, xxxx continued to own 100% of Rockville. RESPONSE: Deny the truth of the allegations contained in Paragraph “47” of the Counterclaims. 48. Pursuant to his will, xxxx expressly passed that 100% interest in Rockville to xxxxxxx as his beneficiary. RESPONSE: Deny the truth of the allegations contained in Paragraph “48” of the Counterclaims. 49. The 100% interest in Rockville was listed as one of xxxx’s assets as part of his estate. RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of the allegations contained in paragraph “49” of the Counterclaims. 50. Neither xxxxxx, nor anyone else, challenged or contested xxxxxxx’s inheritance of all right, title and interest in 100% of Rockville. RESPONSE: Deny the truth of the allegations contained in Paragraph “50” of the Counterclaims. 51. Never, until this lawsuit, has xxxxxx contended – falsely – that he is an 80% owner of Rockville. RESPONSE: Deny the truth of the allegations contained in Paragraph “51” of the Counterclaims. 52. xxxxxx does not own any part of Rockville. RESPONSE: Deny the truth of the allegations contained in Paragraph “52” of the Counterclaims. 53. xxxxxx has never paid any of the income taxes due on Rockville’s profits because he has never had any ownership of any part of that corporation. RESPONSE: Deny the truth of the allegations contained in Paragraph “53” of the Counterclaims. 54. xxxxxxx has maintained 100% ownership of Rockville, except for a short period of time when Rockville was inadvertently placed into xxxx’s testamentary trust. RESPONSE: Deny the truth of the allegations contained in Paragraph “54” of the Counterclaims. 12 12 of 26 11/14/2022 05:22 FILED: NASSAU COUNTY CLERK 02/13/2023 11:58 PM AM INDEX NO. 607197/2022 80 NYSCEF DOC. NO. 89 11/14/2022 RECEIVED NYSCEF: 02/13/2023 55. All of the K-1s for Rockville since xxxx’s death show xxxxxxx as the 100% owner of the corporation, and accordingly, she alone has been responsible for its tax obligations, which she has timely paid. RESPONSE: Deny the truth of allegations contained in paragraph “55” of the Counterclaims. 56. Thus, at all times since its inception, Rockville has owned one asset – the Property – and has only ever had a single 100% shareholder: xxxx, then xxxxxxx. RESPONSE: Deny the truth of the allegations contained in Paragraph “56” of the Counterclaims, except admit that at all times since its inception, Rockville has owned one asset – the Property. D. xxxxxxx Stops Receiving Her Profit Share Payments, And xxxxxx’s Continued Misuse of Bargain Liquors’ Funds 57. xxxx and xxxxxx each performed according to their verbal agreement – that in exchange for Rockville giving xxxxxx free use of the Property, Bargain Liquors would pay all real estate and other property-related taxes on the Property, and would pay xxxx on an annual basis 20% of the net profit of Bargain Liquors – up to xxxx’s untimely death from cancer in 2008. RESPONSE: Deny the truth of the allegations contained in Paragraph “57” of the Counterclaims. 58. Following xxxx’s death and through approximately 2013, xxxxxx continued to make annual payments to xxxxxxx of her share (as successor to xxxx’s interest) of what xxxxxx alleged was 20% of the net profits of Bargain Liquors. RESPONSE: Deny the truth of the allegations contained in Paragraph “58” of the Counterclaims. 59. After 2013, however, xxxxxx stopped making the 20% payments owed to xxxxxxx from the profits from Bargain Liquors. RESPONSE: Deny the truth of the allegations contained in Paragraph “59” of the Counterclaims. 60. Despite the payments having stopped, Bargain Liquors has continued to exploit the rent-free use of Rockville’s Property. 13 13 of 26 11/14/2022 05:22 FILED: NASSAU COUNTY CLERK 02/13/2023 11:58 PM AM INDEX NO. 607197/2022 80 NYSCEF DOC. NO. 89 11/14/2022 RECEIVED NYSCEF: 02/13/2023 RESPONSE: Deny the truth of the allegations contained in Paragraph “60” of the Counterclaims. 61. Each year, xxxxxx made new excuses as to why the business was not profitable, and thus there were allegedly no funds to distribute to xxxxxxx. RESPONSE: Deny the truth of the allegations contained in Paragraph “61” of the Counterclaims. 62. At the same time, xxxxxx proceeded to siphon off money from the business, including by putting numerous members of his family on payroll at Bargain Liquors, despite none of them actually working there. Additionally, those family members receive healthcare benefits at the expense of Bargain Liquors despite the fact that they are not, in fact, actual employees of the business. RESPONSE: Deny the truth of the allegations contained in Paragraph “62” of the Counterclaims. 63. Moreover, xxxxxx and Bargain Liquors consistently have falsely under-reported the profits of Bargain Liquors in tax returns and other filings. RESPONSE: Deny the truth of the allegations contained in Paragraph “63” of the Counterclaims. 64. xxxxxx and Bargain Liquors have also falsely and grossly underreported in tax returns and other filings the amount of cash income that Bargain Liquors takes in year after year. RESPONSE: Deny the truth of the allegations contained in Paragraph “64” of the Counterclaims. 65. As part of that scheme, xxxxxx and Bargain Liquors have falsified inventory reports for Bargain Liquors. RESPONSE: Deny the truth of the allegations contained in Paragraph “65” of the Counterclaims. 66. These schemes, aside from being unlawful, have deprived xxxxxxx of her rightful 20% share of Bargain Liquors’ profits. RESPONSE: Deny the truth of the allegations contained in Paragraph “66” of the Counterclaims. 14 14 of 26 11/14/2022 05:22 FILED: NASSAU COUNTY CLERK 02/13/2023 11:58 PM AM INDEX NO. 607197/2022 80 NYSCEF DOC. NO. 89 11/14/2022 RECEIVED NYSCEF: 02/13/2023 67. Additionally, xxxxxx, in violation of New York Law and regulation – has failed to disclose to the New York Liquor Authority that xxxx had, and xxxxxxx has, a 20% interest in Bargain Liquor’s profits. RESPONSE: Deny the truth of the allegations contained in Paragraph “67” of the Counterclaims. 68. xxxxxx’s and Bargain Liquors’ foregoing falsification of records, false tax reporting, false employee reporting, false medical plan reporting, false Liquor Authority reporting, and other wrongdoing, threaten the imminent loss of Bargain Liquors’ liquor license, and the loss of Bargain Liquors’ business. RESPONSE: Deny the truth of the allegations contained in Paragraph “68” of the Counterclaims. E. xxxxxx’s Bad Faith And Fraudulent Negotiations, And Interference With xxxxxxx’s Sale Of The Property 69. Despite xxxxxx’s wrongdoing, xxxxxxx and her family members have tried to amicably resolve their differences with respect to the liquor store by reaching an accommodation for xxxxxx to buy xxxxxxx out of her ownership of Rockville and her interest in Bargain Liquors’ net profits, and settle all past due amounts of the profits due to xxxxxxx from Bargain Liquors. RESPONSE: Deny the truth of the allegations contained in Paragraph “69” of the Counterclaims, except admit that Plaintiff has engaged in negotiations to purchase xxxxxxx’s 20% interest in Rockville Corp. 70. Unfortunately, xxxxxx has been unwilling to come to a compromise and has refused to negotiate in good faith. RESPONSE: Deny the truth of the allegations contained in Paragraph “70” of the Counterclaims. 71. Accordingly, xxxxxxx’s son, Jordan, began marketing the Property with the use of a real estate broker. RESPONSE: Admit the truth of the allegations contained in Paragraph “71” of the Counterclaims. 15 15 of 26 11/14/2022 05:22 FILED: NASSAU COUNTY CLERK 02/13/2023 11:58 PM AM INDEX NO. 607197/2022 80 NYSCEF DOC. NO. 89 11/14/2022 RECEIVED NYSCEF: 02/13/2023 72. When confronted with this, xxxxxx told xxxxxxx: “go ahead and sell it, the land is not worth that much. I can get another property across the street for much cheaper and don’t need that location.” RESPONSE: Deny the truth of the allegations contained in Paragraph “72” of the Counterclaims. 73. xxxxxx thus acknowledged xxxxxxx’s complete ownership of Rockville, and consequently the Property. RESPONSE: Deny the truth of the allegations contained in Paragraph “73” of the Counterclaims. 74. After this conversation, the real estate broker began marketing the Property and found a bona fide purchaser who signed a Letter of Intent for an all-cash offer of $2.2 million, and who is seeking a quick closing. RESPONSE: Deny the truth of the allegations contained in Paragraph “74” of the Counterclaims, except admit that the real estate broker began marketing the Property over Plaintiff’s objection. 75. Thereafter, xxxxxx contacted the real estate broker and falsely and fraudulently claimed, without any evidence, that Bargain Liquors had a lease for $2,000 per month with 5 to 7 years remaining for the Property. RESPONSE: Deny the truth of the allegations contained in Paragraph “75” of the Counterclaims. 76. Despite numerous requests for proof of this “lease,” by the real estate broker, by Jordan, and by undersigned counsel, xxxxxx has yet to produce any such claimed “lease.” RESPONSE: Deny the truth of the allegations contained in Paragraph “76” of the Counterclaims. 77. xxxxxx’s purported claim of a “lease” for the Property is also at odds with his claims of 80% ownership over Rockville, and in turn the Property, for if he were a majority owner of the Rockville and the Property, he would not need to pay rent to himself for use and enjoyment of his 16 16 of 26 11/14/2022 05:22 FILED: NASSAU COUNTY CLERK 02/13/2023 11:58 PM AM INDEX NO. 607197/2022 80 NYSCEF DOC. NO. 89 11/14/2022 RECEIVED NYSCEF: 02/13/2023 property. Like xxxxxx’s many other falsehoods, his claim of a valid and enforceable written lease is a lie. RESPONSE: Deny the truth of the allegations contained in Paragraph “77” of the Counterclaims. 78. xxxxxx instituted this suit to interfere with the sale of the Property, and to scare off xxxxxxx’s buyer, and deprive xxxxxxx of what she is rightfully due. RESPONSE: Deny the truth of the allegations contained in Paragraph “78” of the Counterclaims. DEMAND FUTILITY 79. xxxxxxx has not made any pre-counterclaim demand upon xxxxxx for a full accounting of Bargain Liquors because such demand would be futile, as evidenced by: xxxxxx’s refusal for more than 8 years to pay xxxxxxx the 20% of profits that is owed to her; and xxxxxx’s bringing this action, rather than negotiating in good faith a buyout of the Property. RESPONSE: Deny the truth of the allegations contained in Paragraph “79” of the Counterclaims. 80. Moreover, because xxxxxx has intentionally attempted to conflate Rockville with Bargain Liquors and instead claim an 80% ownership over these separately owned entities, and because xxxxxx is accused of misusing the corporate entity and falsifying records, xxxxxx does not possess the requisite books and records for a complete accounting of Bargain Liquors profits. RESPONSE: Deny the truth of the allegations contained in Paragraph “80” of the Counterclaims. FIRST COUNTERCLAIM (TORTIOUS INTERFERENCE WITH PROSPECTIVE BUSINESS ADVANTAGE AGAINST xxxxxx) 81. xxxxxxx and Rockville repeat and re-allege each and every allegation contained in paragraphs 1 through 80 of the Counterclaims. RESPONSE: Paragraph “81” of the Counterclaims is not an allegation to which a response is required. 17 17 of 26 11/14/2022 05:22 FILED: NASSAU COUNTY CLERK 02/13/2023 11:58 PM AM INDEX NO. 607197/2022 80 NYSCEF DOC. NO. 89 11/14/2022 RECEIVED NYSCEF: 02/13/2023 82. In early 2022, after failed negotiations with xxxxxx to buy out xxxxxxx’s interest in Bargain Liquors or purchase the Property from Rockville, xxxxxxx, with the help of her son and his selected real estate agent, sought to market the Property for sale. RESPONSE: Deny the truth of the allegations contained in Paragraph “82” of the Counterclaims, except admit that xxxxxxx, with the help of her son, sought to market the Property for Sale. 83. The real estate broker found a bona fide purchaser who signed a Letter of Intent for an all-cash offer of $2.2 million for the Property. RESPONSE: Deny knowledge and information sufficient to form an opinion as to the truth of the allegations contained in paragraph “83” of the Complaint. 84. When xxxxxx learned about this impending sale, he made several attempts to disrupt and interfere with this relationship, including by falsely claiming he had a 5 to 7 year severely-below-market lease for the Property, and by filing this lawsuit to enjoin and stop xxxxxxx from selling her property. RESPONSE: Deny the truth of the allegations contained in Paragraph “84” of the Counterclaims. 85. xxxxxx’s lawsuit is premised on the false allegation that he owns 80% of Rockville – an allegation he knows is false, and was intended only to disrupt xxxxxxx’s sale of the Property. RESPONSE: Deny the truth of the allegations contained in Paragraph “85” of the Counterclaims. 86. Because of xxxxxx’s lawsuit, and the preliminary injunction he obtained, he has succeeded in interfering with xxxxxxx’s and Rockville’s relationship with the prospective buyer, and they have been unable to effect the sale of her Property. RESPONSE: Deny the truth of the allegations contained in Paragraph “86” of the Counterclaims. 18 18 of 26 11/14/2022 05:22 FILED: NASSAU COUNTY CLERK 02/13/2023 11:58 PM AM INDEX NO. 607197/2022 80 NYSCEF DOC. NO. 89 11/14/2022 RECEIVED NYSCEF: 02/13/2023 87. As a direct and proximate result cause of xxxxxx’s wrongdoing, xxxxxxx and Rockville have been harmed in an amount to be determined at trial, but not less than $2,200,000 plus interest. RESPONSE: Paragraph “87” of the Counterclaims proffers a legal conclusion, to which a response is not required. To the extent a response is called for, Counterclaim-Defendants deny the truth of the allegations contained therein, and otherwise respectfully refers all such questions of law to the Court. SECOND COUNTERCLAIM (BREACH OF CONTRACT) 88. xxxxxxx repeats and re-alleges each and every allegation contained in paragraphs 1 through 87 of the Counterclaims. RESPONSE: Paragraph “88” of the Counterclaims is not an allegation to which a response is required. 89. As part of xxxx and xxxxxx’s agreement for Bargain Liquors’ free use of the Property, it was agreed that Bargain Liquors would pay all real estate and other property-related taxes on the Property, and would pay xxxx (and later xxxxxxx) on an annual basis 20% of the net profits of Bargain Liquor. RESPONSE: Deny the truth of the allegations contained in Paragraph “89” of the Counterclaims. 90. xxxx and xxxxxx each performed according to their verbal agreement up to xxxx’s untimely death from cancer in 2008. RESPONSE: Deny the truth of the allegations contained in Paragraph “90” of the Counterclaims. 91. Following