Preview
FILED: WESTCHESTER COUNTY CLERK 03/11/2024 11:36 AM INDEX NO. 60767/2018
NYSCEF DOC. NO. 1802 RECEIVED NYSCEF: 03/11/2024
HL EXHIBIT 47
CUSACK DEPOSITION TRANSCRIPT
SEPTEMBER 29, 2023
FILED: WESTCHESTER COUNTY CLERK 03/11/2024 11:36 AM INDEX NO. 60767/2018
NYSCEF DOC. NO. 1802 RECEIVED NYSCEF: 03/11/2024
Page 252
1 VIDEO TELECONFERENCE DEPOSITION
THOMAS CUSACK
2 VOLUME 2
3
4
STATE OF NEW YORK
5 SUPREME COURT : COUNTY OF WESTCHESTER
6 ----------------------------------------
PAMELA GOLDSTEIN,
7 ELLYN & TONY BERK, As Administrators
of the Estate of Winifred Berk,
8 And PAUL BENJAMIN, on behalf of
themselves and all others similarly
9 situated,
Plaintiffs,
10
- vs - Index No.
11 60767/2018
12 HOULIHAN/LAWRENCE INC.,
13 Defendant.
----------------------------------------
14
15 Video deposition of THOMAS CUSACK, taken
16
17 pursuant to Notice under Article 31 of the Civil
18
19 Practice Law and Rules, at the Cusack Center, 5500
20
21 Main Street, Williamsville, New York, on
22
23 September 29, 2023, commencing at 10:51 a.m.,
24
25 before LYNNE E. DIMARCO, Notary Public.
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1 1 Thomas Cusack
2 APPEARANCES: MINTZ, LEVIN, COHN, FERRIS,
GLOVSKY AND POPEO, P.C. 2 However, certain subject matter we will be
3 By JEREMY C. VEST, ESQ., 3 using, we will -- we will be addressing the book
666 Third Avenue, 4 and its weaknesses in relationship.
4 New York, New York 10017,
(212) 692-6718, 5 Now, there's a new book and the new book is
5 jvest@mintz.com, 6 including 30 hours where the broker's course was
Appearing for Plaintiffs.
7 deficient. And now the chapter one on the license
6
MacGILL P.C., 8 law is modified, the law of agency is modified, and
7 By SCOTT E. MURRAY, ESQ., 9 so there's -- the law of agency isn't modified, but
scott.murray@macgilllaw.com and
8 MACKENZIE N. THOMPSON, ESQ.,
10 the other subject matter is, so it's now a 75-hour
mackenzie.thompson@macgilllaw.com, 11 course.
9 Inland Building, 12 Q. Okay.
156 E. Market Street, Suite 1200,
10 Indianapolis, Indianapolis 46204, 13 A. Okay.
(317) 721-1253, 14 Q. The -- just for the record, you've
11 Appearing for Defendant. 15 given me a copy of the textbook that you are
12 PRESENT: TYLER Z. RAHNER, Videographer
13 16 currently using or that you currently hand out and
14 17 provide in the broker's course; is that correct?
15 18 A. Yes.
16
17 19 Q. And the title of the book is Modern
18 20 Real Estate Practice in New York for Brokers?
19
20
21 A. Yes.
21 22 Q. And it's the 12th edition?
22 23 A. Yes.
23
24
24 Q. And the author is Sam Irlander?
25 25 A. Yes.
Page 254 Page 256
1 Thomas Cusack 1 Thomas Cusack
2 MR. VEST: Jeremy Vest from the Mintz Levin 2 Q. Okay. And have you used previous
3 firm on behalf of the claimants. 3 editions -- and by used I mean in the way that you
4 MR. MURRAY: Scott Murray from McGill, P.C. 4 described?
5 on behalf the Houlihan/Lawrence and then Mackenzie 5 A. Yes, exactly.
6 Thompson also from our office. 6 Q. Have you provided previous editions of
7 EXAMINATION 7 this book, The Modern Real Estate Practice in New
8 BY MR. MURRAY: 8 York for Brokers, to your clients -- or to your
9 Q. Good morning, Mr. Cusack. 9 students over the years?
10 A. Good morning, good morning. 10 A. Over the years, yes, but that has been
11 Q. You understand you're still under oath 11 modified, this is issue -- I think this is 12?
12 today -- 12 Q. Yes.
13 A. Yes. 13 A. This is the 12th edition. Yes, there's
14 Q. -- from your deposition yesterday? 14 a new one coming out, the 13th. And when we get
15 A. Yes, yes. 15 the course approved by the State, then
16 Q. Yesterday during your deposition you 16 we're -- we're using that as a reference guide.
17 mentioned that there's a textbook that you use in 17 And then I have to supply them with the handouts
18 the broker's course that you teach, correct? 18 that I give.
19 A. Uh-huh. I -- let me explain the word 19 Q. Okay.
20 use. I give it out to the broker, as people want 20 A. Okay.
21 to get their broker's license, I give it out to 21 Q. The copyright date on the 12th edition
22 them, it is a reference book, there are questions 22 is 2019. I know you don't have the book in front
23 in there, there are magnificent definitions in the 23 of you, but I'll tell you it's 2019. Did you use
24 back of the book, there are some review tests in 24 the 11th edition prior to the issuance of the 12th
25 the back. 25 edition?
2 (Pages 253 - 256)
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2 A. My recall is yes. 2 remember to verbalize your answer.
3 Q. Okay. 3 THE WITNESS: Yes, I'm sorry.
4 A. My recall is that -- that I used it. 4 BY MR. MURRAY:
5 Q. Do you know Mr. Irlander? 5 Q. And there's materials in the textbook
6 A. I don't know him, but I know of him. 6 that relate to the disclosure form; is that
7 Q. And what -- what do you know of him? 7 correct?
8 A. He is a commercial broker in New York 8 A. I think so, but I'm not absolutely
9 City, he is a very dedicated, conscientious 9 certain.
10 practitioner, but I know of him, his -- his -- his 10 Q. Okay.
11 kudos, his -- his recognition by the industry as 11 A. Relating in that context. There
12 being a good practitioner. 12 is -- I'm sure there is an agency disclosure form
13 Q. Okay. And is it required by the State 13 in there.
14 for you to make Mr. Irlander's book available to 14 Q. And I'll just --
15 your students in the broker's course? 15 A. Yes.
16 A. No, it's not required, it's -- but they 16 Q. I'm holding up a -- a page in the
17 want something that would be a reference text. 17 textbook showing you that --
18 Q. Okay. 18 A. Yes.
19 A. So we have used this one. Over the 19 Q. -- there's a disclosure form actually
20 years, Dearborn Financial Publishing has used the 20 in the textbook, correct?
21 broker to produce the book. 21 A. Yes, and I'm giving them -- I'm giving
22 Q. Okay. And so of the various options 22 to the students a copy of the agency disclosure
23 you had to provide a reference to your students, 23 form for us to deal with.
24 you chose to use the -- 24 Q. And are there descriptions in the
25 A. The options -- 25 textbook about the different types of agency under
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1 Thomas Cusack 1 Thomas Cusack
2 Q. -- the Irlander text? 2 New York law?
3 A. I'm -- I'm sorry. Okay. 3 A. Yes.
4 Q. Go ahead. Did you hear the question or 4 Q. And that would include seller's agents,
5 did you want me to repeat it? 5 buyer's agents, dual agents and dual agents with
6 A. Yeah, just the end of it. 6 designated sales agents?
7 Q. Yeah, let me just repeat it. 7 A. Yes.
8 So of -- you mentioned a moment ago that the 8 Q. Okay. When you make this textbook
9 State wants you to have some resource that you make 9 available to your students, do you -- do
10 available to your students; is that right? 10 you -- well, strike that.
11 A. Uh-huh. 11 Have you read the materials in the textbook
12 Q. And so -- 12 that deal with dual agency and designated agency
13 A. Yes. 13 yourself?
14 Q. And so here at the Cusack Center you've 14 A. Uh-huh.
15 chosen to make this particular textbook available 15 Q. Yes?
16 to your students in the broker's course? 16 A. Yes, I'll get it, maybe.
17 A. Yes. 17 Q. And when you provide a copy of the
18 Q. And I've had a -- a moment just to flip 18 textbook to your students, do you tell them that
19 through it, there's materials in this textbook that 19 there's anything in the textbook relating to dual
20 deal with agency law; is that right? 20 agency or designated agency that's incorrect?
21 A. Uh-huh. 21 A. Yes.
22 Q. Yes? 22 Q. And what is that?
23 A. Yes. 23 A. This is dual agency with designated
24 MR. VEST: You got to 24 sales agent is, in fact, contrary to the
25 verbalize -- Mr. Cusack, if you would, just try to 25 regulations of the Department of State, the law of
3 (Pages 257 - 260)
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1 Thomas Cusack 1 Thomas Cusack
2 confused. I will -- 2 teach that most of the those students are taking
3 A. Okay. 3 before they've actually become real estate agents?
4 Q. -- acknowledge my confusion, so I'm 4 A. Yes.
5 going to ask you some additional questions. Let's 5 Q. Okay. Do you have -- do you keep track
6 start with your new licensee course. 6 of how many of your students who take the 77-hour
7 You said most of your students to whom you 7 pre-licensing course go on to become full-time
8 teach agency are students who are taking your new 8 agents?
9 licensee course; is that correct? 9 A. Not -- not with any precision, but we
10 A. That's the 77-hour course. 10 do try to track it, but...
11 Q. Okay. Is that correct, though, that 11 Q. Do you have a general sense of what
12 most of your students to whom you teach agency are 12 percentage of your students who take the
13 taking the 77-hour new licensee course? 13 pre-licensing course become full-time agents?
14 A. Yes. 14 A. I would say probably two-thirds and
15 Q. And at the time they are taking that 15 then -- so the information I get, feedback, is a
16 course, are they or are they not real estate 16 third of them leave the business within the first
17 agents? 17 two years.
18 A. They are not. 18 Q. Okay.
19 Q. So most of your students to whom you 19 A. A third of those, so a third,
20 teach agency law are not yet real estate agents? 20 two-thirds.
21 MR. VEST: Objection, vague and ambiguous as 21 Q. Okay. So just to make sure I
22 to most. 22 understand the numbers you just gave. Based on
23 THE WITNESS: Well -- 23 your attempt to track your students, approximately
24 BY MR. MURRAY: 24 two-thirds of your students who take the
25 Q. Are you confused by my use of the term 25 pre-licensing course go on to become full-time
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1 Thomas Cusack 1 Thomas Cusack
2 most? 2 agents. And then of those approximately one-third
3 A. No, I'm saying that they're -- they're 3 drop out and move on to something else within --
4 some who will come back to take it audited because 4 A. Yes.
5 they were licensed and they let their license 5 Q. -- the first two years?
6 expire and it's been past the two-year grace period 6 A. Yes.
7 and they have to take another exam, state exam. 7 Q. Okay. Sir, do you agree that one of
8 Q. Is that -- 8 the most success -- well, one of the ways for a
9 A. That's -- there's a three-step process 9 real estate agent to become successful is to
10 to get a license. They've got to take the 77-hour 10 generate positive referrals from friends, family,
11 course and attend it and successfully pass the 11 and customers, clients of theirs?
12 exam. They have to pass the state exam and then 12 A. Right, yes.
13 they get a broker's license. 13 Q. Okay. And is that, in fact, the best
14 Q. Okay. 14 way to become a successful real estate agent is to
15 A. Okay. So then -- 15 generate positive referrals from the clients you've
16 Q. Sir, I appreciate the explanation, but 16 worked with?
17 I want to focus on my questions, not on -- 17 MR. VEST: Objection, vague and ambiguous,
18 A. Okay. 18 overbroad.
19 Q. -- on what you're talking about right 19 THE WITNESS: It plays a part, but it's not
20 now. 20 the -- it's not the best.
21 A. Okay. 21 BY MR. MURRAY:
22 Q. So I have a very narrow focus on this 22 Q. What's the best?
23 question. I'm trying to understand whether most of 23 A. I mean, they're all contributing to it,
24 the students to whom you teach agency law are 24 they're all -- they're broadening their scope
25 taking the pre-licensing 77-hour course that you 25 contacting other people in conversation throughout
7 (Pages 273 - 276)
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2 the marketplace. There's so many ways for them to 2 BY MR. MURRAY:
3 generate leads and generate people. And the 3 Q. Now, sir, you understand -- let me ask
4 referred business is where satisfied customers come 4 you this. Do you have a sense of how many
5 that's a very, very good referral. 5 Houlihan/Lawrence agents were involved in the
6 And it is -- it is -- it is a part of you 6 transactions that fall within the class in this
7 building your business. And in the long run the 7 lawsuit?
8 more you do the better, but you're still generating 8 A. Do I have a --
9 new -- new contacts. 9 Q. A sense of how many Houlihan/Lawrence
10 Q. Okay. 10 agents were involved in the transactions that fall
11 A. And there are only so many relatives 11 within the class in this lawsuit?
12 and friends that you have. 12 A. Well, I know that there were
13 Q. Sure, but you're -- 13 approximately 10,000 transactions that were
14 A. But -- 14 questioned. And some of them could have been
15 Q. But your client source over the years 15 single agents. And the majority of them are double
16 the more -- the more you provide good service to 16 agents, so I would -- I would -- I would not
17 your clients, the more clients you have that are 17 speculate about how many.
18 providing you with good referrals, it can snowball? 18 Q. Okay. I was just asking. So you don't
19 A. Yes. 19 know the number?
20 Q. And that can become a very important 20 A. I don't know the number, no.
21 factor to developing -- 21 Q. Okay.
22 A. It's important, it's important. 22 A. I wouldn't -- and I don't have
23 MR. VEST: Mr. Cusack. 23 data -- enough data that tells me how does that
24 BY MR. MURRAY: 24 break down.
25 Q. That can become a very important factor 25 Q. Okay. Well, I will represent to you
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1 Thomas Cusack 1 Thomas Cusack
2 in becoming a successful real estate agent; do you 2 that the data has been produced in the case and the
3 agree with that? 3 agents have been identified and we've got various
4 MR. VEST: Objection, compound. 4 lists of agents, and it's over 1,300
5 THE WITNESS: It's a -- it's a continuing. 5 Houlihan/Lawrence agents involved in the various
6 It is contributing factor, yes. 6 transactions that fit within the class notice in
7 BY MR. MURRAY: 7 this case.
8 Q. Okay. Yesterday you mentioned, and you 8 Do you agree, sir, that it's
9 cite in your report, a source about an estimate 9 possible -- well, strike that.
10 that it would take 20 to 30 minutes to explain the 10 You have not reviewed e-mails or
11 disclosure form to a client; do you recall that? 11 communications involving all of those agents, have
12 A. Yes. 12 you?
13 Q. Do you have any idea what the typical 13 A. No.
14 time is that an agent in New York spends in 14 Q. And do you agree that it is possible,
15 explaining the disclosure form to their clients? 15 sir, that some of those agents gave disclosures
16 A. I don't -- I -- typical? 16 relating to dual agency and designated agency that
17 Q. Yeah, in actual practice, not what 17 you would find appropriate, do you think that is
18 someone has estimated, not what somebody thinks it 18 possible?
19 should be, what it actually is in practice? 19 A. I take exception to describe some.
20 MR. VEST: Objection, vague and ambiguous, 20 Q. At least one, do you agree that it
21 calls to speculation. 21 would be possible that an agent, one of those
22 THE WITNESS: It's very hard for me to say 22 agents provided a disclosure on dual and designated
23 the time, but as long as all of the -- as long 23 agency that you would find sufficient, do you think
24 as -- no, I don't have -- I don't have a -- I can't 24 that's possible?
25 answer that. 25 A. I would say it's possible.
8 (Pages 277 - 280)
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2 Q. And -- 2 involved in the transactions in this case read the
3 A. But unlikely, unlikely on the basis of 3 prompt sheet, the script that you referred to in
4 if we're talking about that they were trained by 4 your materials?
5 Houlihan/Lawrence, and they -- they practiced 5 A. I don't know.
6 according to the Houlihan/Lawrence's practice, I 6 Q. How many of the 1,300 plus agents
7 can only comment about that. 7 involved in the transactions in this case used the
8 It would not -- it would be unlikely if they 8 prompt sheet, what you call a script, how many of
9 followed the Houlihan/Lawrence training that they 9 the 1,300 agents used that document to provide
10 would have made the -- I'd say it's highly unlikely 10 disclosures to their clients?
11 from the training. 11 A. I -- I don't know how many used it, but
12 Q. Okay. And which training are you 12 I do know how they did communicate the agency
13 talking about? 13 disclosure form to the consumer, six of the top
14 A. I'm talking about Houlihan/Lawrence's 14 agents how they communicated.
15 training. 15 Q. Well, sir, you know what was said in
16 Q. How many -- 16 the e-mails you reviewed from those six agents,
17 A. The -- go ahead. 17 correct?
18 Q. Go ahead. Finish your answer, I didn't 18 MR. VEST: Objection, mischaracterizes the
19 mean to interrupt you. 19 witness' testimony.
20 A. That's okay. The -- I look at the role 20 THE WITNESS: Yes.
21 plays, I look at the scripts, I look at the 21 BY MR. MURRAY:
22 handouts that they were instructed to give in 22 Q. You do not know what was orally said by
23 relation to agency, okay, in relation to agency. 23 any one of those six agents to any one of their
24 Not in relation to the other things that 24 clients?
25 they train their agents to do, but just in relation 25 MR. VEST: Objection, mischaracterizes the
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1 Thomas Cusack 1 Thomas Cusack
2 to those, and it is -- it is sorely deficient in 2 witness' testimony, vague as to know.
3 proper training. So that if they were following 3 THE WITNESS: I'm having a difficulty
4 this directive, which is what Houlihan/Lawrence 4 with -- with understanding how it -- how it relates
5 says is the standard procedure that we want you to 5 to what I testified.
6 perform when you're -- when you are using and 6 BY MR. MURRAY:
7 explaining agency, that my conclusion would be it's 7 Q. You just said, sir, that you do know
8 highly unlikely that if -- 8 how the six agents identified in your report
9 Q. All right. 9 communicated their disclosures.
10 A. So I'm saying if they went through the 10 And I'm asking -- and I'm just confirming
11 training, it is highly unlikely from my 11 what you testified to yesterday is you reviewed
12 perspective. 12 certain e-mails from those six agents, but you have
13 Q. All right. So of the 1,300 agents, 13 no idea what was said orally in a conversation
14 1,300 plus agents involved in the transactions at 14 between any one of those six agents and any one of
15 issue in this case, how many of them participated 15 their clients?
16 in any -- in the role plays that you just 16 A. No.
17 mentioned? 17 MR. VEST: Objection, mischaracterizes the
18 A. I don't know. 18 witness' testimony from yesterday and in his
19 Q. How many of the 1,300 agents 19 report.
20 at -- involved in the transactions in this case 20 THE WITNESS: Because -- because it
21 received the prompt sheet which you referred to in 21 mischaracterizes it, because you're not -- you're
22 your report in your affidavit as the script, how 22 not saying they constantly. The managers of the
23 many of those agents received that document? 23 company constantly said that it's the most
24 A. I don't know. 24 misunderstood, avoided, neglected, and abused part
25 Q. How many of the 1,300 plus agents 25 of our business.
9 (Pages 281 - 284)
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2 It's very, very difficult, we need to be 2 A. Yes.
3 able to do it properly. And they brought in 3 Q. Do you have any reason to believe, sir,
4 trainers from HGAR, they brought in Cummings, a 4 that HGAR is in some kind of conspiratorial
5 lawyer from -- from HGAR to do training on to 5 agreement with Houlihan/Lawrence to trick
6 designate or not to designate. They felt the need, 6 Houlihan/Lawrence agents into misunderstanding dual
7 we need training in all of the communications. 7 agency and designated agency?
8 BY MR. MURRAY: 8 MR. VEST: Objection, argumentative.
9 Q. So, sir, why did Houlihan/Lawrence, why 9 THE WITNESS: Miss?
10 would they bring in training from outside resources 10 BY MR. MURRAY:
11 from HGAR, what is HGAR? 11 Q. You don't think that, do you, sir?
12 A. It's -- it's the holiday -- or it's the 12 MR. VEST: Objection.
13 Valley's board of realtors association. 13 THE WITNESS: No, I don't understand.
14 Q. The Hudson? 14 BY MR. MURRAY:
15 A. Hudson Gateway Board of Realtors. 15 Q. Sure.
16 Q. Okay. And it's an outside entity 16 A. Where did you get this from what I was
17 unrelated to Houlihan/Lawrence? 17 saying.
18 A. No, no, no, no, not unrelated. It is a 18 Q. Because a moment ago, sir, you said
19 membership organization where I would speculate 19 that Houlihan/Lawrence brings in outside trainers
20 that most of those -- most of those licensees, as 20 to teach its agents about how to deal with dual and
21 in Houlihan/Lawrence, if they want to participate 21 designated agency, correct?
22 in the multiple listing system must belong to a 22 A. Yes.
23 realtor association. 23 Q. And one of those outside entities is
24 Q. Sir -- 24 HGAR, correct?
25 A. So I'm saying that it -- it would be 25 A. Yes, which is a --
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1 Thomas Cusack 1 Thomas Cusack
2 highly unlikely for me to say that they were not 2 Q. And, sir, do you think HGAR when it was
3 members of HGAR and they -- they use HGAR as a 3 brought in to train Houlihan/Lawrence agents was
4 source of lobbying, they use HGAR as a source of 4 brought in to train them incorrectly with their
5 helping them in their practice. 5 obligations under New York law?
6 And -- and Houlihan/Lawrence can call upon 6 A. No.
7 HGAR and their legal department to come in and add 7 Q. Okay. So my question to you is if you
8 validity to explaining agency. 8 think that Houlihan/Lawrence was intentionally
9 Q. So let me ask you this. First of all, 9 directing its agents to miss describe the risks of
10 you talked about NYSAR yesterday, correct? 10 dual and designated agency to their clients, why
11 A. Yes. 11 were they bringing in HGAR to provide training to
12 Q. NYSAR is a realtor association? 12 their agents?
13 A. Yes. 13 MR. VEST: Objection, assumes facts, lacks
14 Q. It's a member -- 14 foundation, mischaracterizes the witness'
15 A. That the state, that's a state 15 testimony.
16 association. 16 THE WITNESS: Okay. So let me go back.
17 Q. It's a membership association? 17 MR. VEST: And argumentative.
18 A. Member, yes. 18 THE WITNESS: Okay. So let me back up. And
19 Q. It does lobbying on behalf of realtors? 19 my reference was to Don Cummings who came in in
20 A. Yeah. 20 2015. But prior to that in 2011 Hagerty, who was
21 Q. Yes? 21 the -- I believe the executive director of HGAR and
22 A. Yes. 22 Alt decided they were going to do a training
23 Q. It provides a document that you say is 23 program to help the agents to understand it.
24 a useful tool in explaining dual and designated 24 And at that juncture they were dealing with
25 agency to consumers, correct? 25 undivided loyalty as part of the -- part of the
10 (Pages 285 - 288)
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2 the article Mr. Gotto said that there had been 2 start and it's got to be informed consent in
3 discussions between NYSAR and the Department of 3 writing.
4 State; is that right? 4 BY MR. MURRAY:
5 A. Uh-huh. 5 Q. Sir, is this -- the legal memorandum is
6 Q. Yes? 6 the one that's entitled be wary of dual agency,
7 A. Yes. 7 legal memorandum LI --
8 Q. And some of the opinions you've given 8 A. I have to --
9 in this case are in part based on discussions that 9 Q. -- 12.
10 you've had with people at the Department of State; 10 A. Again, I have to go back and look at
11 is that correct, in part? 11 that. That -- yes, but as amended, because
12 A. In part, but not particularly for this. 12 it's -- it -- it follows a sequence when these
13 Q. Now -- 13 things come out, but I would -- I would want to
14 A. But there's something that I could say 14 look at that before we answer.
15 that as you read this, you passed over a sentence. 15 MR. VEST: And my objection is calls for
16 It said in order to minimize the potential for 16 speculation.
17 liability, all notices should be in writing and 17 BY MR. MURRAY:
18 made at the time of negotiations or immediately 18 Q. And I'll -- I'll just represent to you
19 thereafter, but it's got to be -- it's got to be in 19 I'm looking at a document on my computer, legal
20 writing. 20 memorandum LI12, be wary of dual agency.
21 Q. Well, sir. 21 And at the end it says updated February of
22 A. Yes, okay. 22 2020, is that the legal memorandum that you have in
23 Q. In fairness, the sentence that you just 23 mind?
24 read says, in order to minimize liability, it 24 MR. VEST: Objection, calls for speculation,
25 doesn't say it's required, it's giving practical 25 lacks foundation, asked and answered.
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1 Thomas Cusack 1 Thomas Cusack
2 advice to agents and brokers about what would be a 2 THE WITNESS: I have to see the document,
3 good idea from a risk management perspective. 3 because, yeah.
4 It is not saying that you are required to 4 BY MR. MURRAY:
5 give all notices in writing, because, sir, that 5 Q. Sir, on Exhibit 316 in the third
6 would conflict with what he said right above there. 6 paragraph on page 1, do you see a reference by
7 MR. VEST: Objection. 7 Mr. Gotto to legal memorandum LI12, be wary of dual
8 BY MR. MURRAY: 8 agency; do you see that?
9 Q. That the notice -- that the notice can 9 A. Uh-huh.
10 be by telephone. 10 Q. Yes?
11 THE WITNESS: He says. 11 A. Yes.
12 MR. VEST: Objection, argumentative. 12 Q. Now, do you remember, were there any
13 Mr. Cusack -- 13 amendments to that legal memorandum between the
14 THE WITNESS: Okay. I'm saying Anthony 14 third quarter of 2010 and 2020?
15 Gotto says this. 15 A. I -- I'm trying to remember this.
16 BY MR. MURRAY: 16 MR. VEST: And, sir, I'm going to give you
17 Q. And Anthony Gotto says based on 17 the same caution I gave earlier, do not speculate.
18 conversations that NYSAR has had with the 18 If you have a -- a recollection, you're more than
19 Department of State. 19 willing to -- or able to provide it.
20 MR. VEST: Objection, mischaracterizes the 20 THE WITNESS: I -- I can't.
21 document, assumes facts, overbroad. 21 MR. VEST: Do not speculate.
22 THE WITNESS: But the -- the -- okay. I'm 22 THE WITNESS: Yeah, I can't, I can't
23 in -- I would once again state that in my document 23 remember, but...
24 it's got to be according to -- according to a legal 24 MR. VEST: You've answered the question.
25 memorandum, it's got to be before the negotiations 25 THE WITNESS: I can't remember.
26 (Pages 349 - 352)
Veritext Legal Solutions
www.veritext.com 888-391-3376
FILED: WESTCHESTER COUNTY CLERK 03/11/2024 11:36 AM INDEX NO. 60767/2018
NYSCEF DOC. NO. 1802 RECEIVED NYSCEF: 03/11/2024
Page 353 Page 355
1 Thomas Cusack 1 Thomas Cusack
2 BY MR. MURRAY: 2 trying to see if there was evidence indicating
3 Q. Sir, is it your recollection that the 3 whether that single agent was acting as a dual
4 legal memorandum that you were previously 4 agent or whether the buyer was unrepresented; is
5 discussing, whatever that legal memorandum was that 5 that your general understanding?
6 you were remembering, did that specifically deals 6 MR. VEST: Objection
Preview
FILED: WESTCHESTER COUNTY CLERK 03/11/2024 11:36 AM INDEX NO. 60767/2018 NYSCEF DOC. NO. 1802 RECEIVED NYSCEF: 03/11/2024 HL EXHIBIT 47 CUSACK DEPOSITION TRANSCRIPT SEPTEMBER 29, 2023 FILED: WESTCHESTER COUNTY CLERK 03/11/2024 11:36 AM INDEX NO. 60767/2018 NYSCEF DOC. NO. 1802 RECEIVED NYSCEF: 03/11/2024 Page 252 1 VIDEO TELECONFERENCE DEPOSITION THOMAS CUSACK 2 VOLUME 2 3 4 STATE OF NEW YORK 5 SUPREME COURT : COUNTY OF WESTCHESTER 6 ---------------------------------------- PAMELA GOLDSTEIN, 7 ELLYN & TONY BERK, As Administrators of the Estate of Winifred Berk, 8 And PAUL BENJAMIN, on behalf of themselves and all others similarly 9 situated, Plaintiffs, 10 - vs - Index No. 11 60767/2018 12 HOULIHAN/LAWRENCE INC., 13 Defendant. ---------------------------------------- 14 15 Video deposition of THOMAS CUSACK, taken 16 17 pursuant to Notice under Article 31 of the Civil 18 19 Practice Law and Rules, at the Cusack Center, 5500 20 21 Main Street, Williamsville, New York, on 22 23 September 29, 2023, commencing at 10:51 a.m., 24 25 before LYNNE E. DIMARCO, Notary Public. Veritext Legal Solutions www.veritext.com 888-391-3376 FILED: WESTCHESTER COUNTY CLERK 03/11/2024 11:36 AM INDEX NO. 60767/2018 NYSCEF DOC. NO. 1802 RECEIVED NYSCEF: 03/11/2024 Page 253 Page 255 1 1 Thomas Cusack 2 APPEARANCES: MINTZ, LEVIN, COHN, FERRIS, GLOVSKY AND POPEO, P.C. 2 However, certain subject matter we will be 3 By JEREMY C. VEST, ESQ., 3 using, we will -- we will be addressing the book 666 Third Avenue, 4 and its weaknesses in relationship. 4 New York, New York 10017, (212) 692-6718, 5 Now, there's a new book and the new book is 5 jvest@mintz.com, 6 including 30 hours where the broker's course was Appearing for Plaintiffs. 7 deficient. And now the chapter one on the license 6 MacGILL P.C., 8 law is modified, the law of agency is modified, and 7 By SCOTT E. MURRAY, ESQ., 9 so there's -- the law of agency isn't modified, but scott.murray@macgilllaw.com and 8 MACKENZIE N. THOMPSON, ESQ., 10 the other subject matter is, so it's now a 75-hour mackenzie.thompson@macgilllaw.com, 11 course. 9 Inland Building, 12 Q. Okay. 156 E. Market Street, Suite 1200, 10 Indianapolis, Indianapolis 46204, 13 A. Okay. (317) 721-1253, 14 Q. The -- just for the record, you've 11 Appearing for Defendant. 15 given me a copy of the textbook that you are 12 PRESENT: TYLER Z. RAHNER, Videographer 13 16 currently using or that you currently hand out and 14 17 provide in the broker's course; is that correct? 15 18 A. Yes. 16 17 19 Q. And the title of the book is Modern 18 20 Real Estate Practice in New York for Brokers? 19 20 21 A. Yes. 21 22 Q. And it's the 12th edition? 22 23 A. Yes. 23 24 24 Q. And the author is Sam Irlander? 25 25 A. Yes. Page 254 Page 256 1 Thomas Cusack 1 Thomas Cusack 2 MR. VEST: Jeremy Vest from the Mintz Levin 2 Q. Okay. And have you used previous 3 firm on behalf of the claimants. 3 editions -- and by used I mean in the way that you 4 MR. MURRAY: Scott Murray from McGill, P.C. 4 described? 5 on behalf the Houlihan/Lawrence and then Mackenzie 5 A. Yes, exactly. 6 Thompson also from our office. 6 Q. Have you provided previous editions of 7 EXAMINATION 7 this book, The Modern Real Estate Practice in New 8 BY MR. MURRAY: 8 York for Brokers, to your clients -- or to your 9 Q. Good morning, Mr. Cusack. 9 students over the years? 10 A. Good morning, good morning. 10 A. Over the years, yes, but that has been 11 Q. You understand you're still under oath 11 modified, this is issue -- I think this is 12? 12 today -- 12 Q. Yes. 13 A. Yes. 13 A. This is the 12th edition. Yes, there's 14 Q. -- from your deposition yesterday? 14 a new one coming out, the 13th. And when we get 15 A. Yes, yes. 15 the course approved by the State, then 16 Q. Yesterday during your deposition you 16 we're -- we're using that as a reference guide. 17 mentioned that there's a textbook that you use in 17 And then I have to supply them with the handouts 18 the broker's course that you teach, correct? 18 that I give. 19 A. Uh-huh. I -- let me explain the word 19 Q. Okay. 20 use. I give it out to the broker, as people want 20 A. Okay. 21 to get their broker's license, I give it out to 21 Q. The copyright date on the 12th edition 22 them, it is a reference book, there are questions 22 is 2019. I know you don't have the book in front 23 in there, there are magnificent definitions in the 23 of you, but I'll tell you it's 2019. Did you use 24 back of the book, there are some review tests in 24 the 11th edition prior to the issuance of the 12th 25 the back. 25 edition? 2 (Pages 253 - 256) Veritext Legal Solutions www.veritext.com 888-391-3376 FILED: WESTCHESTER COUNTY CLERK 03/11/2024 11:36 AM INDEX NO. 60767/2018 NYSCEF DOC. NO. 1802 RECEIVED NYSCEF: 03/11/2024 Page 257 Page 259 1 Thomas Cusack 1 Thomas Cusack 2 A. My recall is yes. 2 remember to verbalize your answer. 3 Q. Okay. 3 THE WITNESS: Yes, I'm sorry. 4 A. My recall is that -- that I used it. 4 BY MR. MURRAY: 5 Q. Do you know Mr. Irlander? 5 Q. And there's materials in the textbook 6 A. I don't know him, but I know of him. 6 that relate to the disclosure form; is that 7 Q. And what -- what do you know of him? 7 correct? 8 A. He is a commercial broker in New York 8 A. I think so, but I'm not absolutely 9 City, he is a very dedicated, conscientious 9 certain. 10 practitioner, but I know of him, his -- his -- his 10 Q. Okay. 11 kudos, his -- his recognition by the industry as 11 A. Relating in that context. There 12 being a good practitioner. 12 is -- I'm sure there is an agency disclosure form 13 Q. Okay. And is it required by the State 13 in there. 14 for you to make Mr. Irlander's book available to 14 Q. And I'll just -- 15 your students in the broker's course? 15 A. Yes. 16 A. No, it's not required, it's -- but they 16 Q. I'm holding up a -- a page in the 17 want something that would be a reference text. 17 textbook showing you that -- 18 Q. Okay. 18 A. Yes. 19 A. So we have used this one. Over the 19 Q. -- there's a disclosure form actually 20 years, Dearborn Financial Publishing has used the 20 in the textbook, correct? 21 broker to produce the book. 21 A. Yes, and I'm giving them -- I'm giving 22 Q. Okay. And so of the various options 22 to the students a copy of the agency disclosure 23 you had to provide a reference to your students, 23 form for us to deal with. 24 you chose to use the -- 24 Q. And are there descriptions in the 25 A. The options -- 25 textbook about the different types of agency under Page 258 Page 260 1 Thomas Cusack 1 Thomas Cusack 2 Q. -- the Irlander text? 2 New York law? 3 A. I'm -- I'm sorry. Okay. 3 A. Yes. 4 Q. Go ahead. Did you hear the question or 4 Q. And that would include seller's agents, 5 did you want me to repeat it? 5 buyer's agents, dual agents and dual agents with 6 A. Yeah, just the end of it. 6 designated sales agents? 7 Q. Yeah, let me just repeat it. 7 A. Yes. 8 So of -- you mentioned a moment ago that the 8 Q. Okay. When you make this textbook 9 State wants you to have some resource that you make 9 available to your students, do you -- do 10 available to your students; is that right? 10 you -- well, strike that. 11 A. Uh-huh. 11 Have you read the materials in the textbook 12 Q. And so -- 12 that deal with dual agency and designated agency 13 A. Yes. 13 yourself? 14 Q. And so here at the Cusack Center you've 14 A. Uh-huh. 15 chosen to make this particular textbook available 15 Q. Yes? 16 to your students in the broker's course? 16 A. Yes, I'll get it, maybe. 17 A. Yes. 17 Q. And when you provide a copy of the 18 Q. And I've had a -- a moment just to flip 18 textbook to your students, do you tell them that 19 through it, there's materials in this textbook that 19 there's anything in the textbook relating to dual 20 deal with agency law; is that right? 20 agency or designated agency that's incorrect? 21 A. Uh-huh. 21 A. Yes. 22 Q. Yes? 22 Q. And what is that? 23 A. Yes. 23 A. This is dual agency with designated 24 MR. VEST: You got to 24 sales agent is, in fact, contrary to the 25 verbalize -- Mr. Cusack, if you would, just try to 25 regulations of the Department of State, the law of 3 (Pages 257 - 260) Veritext Legal Solutions www.veritext.com 888-391-3376 FILED: WESTCHESTER COUNTY CLERK 03/11/2024 11:36 AM INDEX NO. 60767/2018 NYSCEF DOC. NO. 1802 RECEIVED NYSCEF: 03/11/2024 Page 273 Page 275 1 Thomas Cusack 1 Thomas Cusack 2 confused. I will -- 2 teach that most of the those students are taking 3 A. Okay. 3 before they've actually become real estate agents? 4 Q. -- acknowledge my confusion, so I'm 4 A. Yes. 5 going to ask you some additional questions. Let's 5 Q. Okay. Do you have -- do you keep track 6 start with your new licensee course. 6 of how many of your students who take the 77-hour 7 You said most of your students to whom you 7 pre-licensing course go on to become full-time 8 teach agency are students who are taking your new 8 agents? 9 licensee course; is that correct? 9 A. Not -- not with any precision, but we 10 A. That's the 77-hour course. 10 do try to track it, but... 11 Q. Okay. Is that correct, though, that 11 Q. Do you have a general sense of what 12 most of your students to whom you teach agency are 12 percentage of your students who take the 13 taking the 77-hour new licensee course? 13 pre-licensing course become full-time agents? 14 A. Yes. 14 A. I would say probably two-thirds and 15 Q. And at the time they are taking that 15 then -- so the information I get, feedback, is a 16 course, are they or are they not real estate 16 third of them leave the business within the first 17 agents? 17 two years. 18 A. They are not. 18 Q. Okay. 19 Q. So most of your students to whom you 19 A. A third of those, so a third, 20 teach agency law are not yet real estate agents? 20 two-thirds. 21 MR. VEST: Objection, vague and ambiguous as 21 Q. Okay. So just to make sure I 22 to most. 22 understand the numbers you just gave. Based on 23 THE WITNESS: Well -- 23 your attempt to track your students, approximately 24 BY MR. MURRAY: 24 two-thirds of your students who take the 25 Q. Are you confused by my use of the term 25 pre-licensing course go on to become full-time Page 274 Page 276 1 Thomas Cusack 1 Thomas Cusack 2 most? 2 agents. And then of those approximately one-third 3 A. No, I'm saying that they're -- they're 3 drop out and move on to something else within -- 4 some who will come back to take it audited because 4 A. Yes. 5 they were licensed and they let their license 5 Q. -- the first two years? 6 expire and it's been past the two-year grace period 6 A. Yes. 7 and they have to take another exam, state exam. 7 Q. Okay. Sir, do you agree that one of 8 Q. Is that -- 8 the most success -- well, one of the ways for a 9 A. That's -- there's a three-step process 9 real estate agent to become successful is to 10 to get a license. They've got to take the 77-hour 10 generate positive referrals from friends, family, 11 course and attend it and successfully pass the 11 and customers, clients of theirs? 12 exam. They have to pass the state exam and then 12 A. Right, yes. 13 they get a broker's license. 13 Q. Okay. And is that, in fact, the best 14 Q. Okay. 14 way to become a successful real estate agent is to 15 A. Okay. So then -- 15 generate positive referrals from the clients you've 16 Q. Sir, I appreciate the explanation, but 16 worked with? 17 I want to focus on my questions, not on -- 17 MR. VEST: Objection, vague and ambiguous, 18 A. Okay. 18 overbroad. 19 Q. -- on what you're talking about right 19 THE WITNESS: It plays a part, but it's not 20 now. 20 the -- it's not the best. 21 A. Okay. 21 BY MR. MURRAY: 22 Q. So I have a very narrow focus on this 22 Q. What's the best? 23 question. I'm trying to understand whether most of 23 A. I mean, they're all contributing to it, 24 the students to whom you teach agency law are 24 they're all -- they're broadening their scope 25 taking the pre-licensing 77-hour course that you 25 contacting other people in conversation throughout 7 (Pages 273 - 276) Veritext Legal Solutions www.veritext.com 888-391-3376 FILED: WESTCHESTER COUNTY CLERK 03/11/2024 11:36 AM INDEX NO. 60767/2018 NYSCEF DOC. NO. 1802 RECEIVED NYSCEF: 03/11/2024 Page 277 Page 279 1 Thomas Cusack 1 Thomas Cusack 2 the marketplace. There's so many ways for them to 2 BY MR. MURRAY: 3 generate leads and generate people. And the 3 Q. Now, sir, you understand -- let me ask 4 referred business is where satisfied customers come 4 you this. Do you have a sense of how many 5 that's a very, very good referral. 5 Houlihan/Lawrence agents were involved in the 6 And it is -- it is -- it is a part of you 6 transactions that fall within the class in this 7 building your business. And in the long run the 7 lawsuit? 8 more you do the better, but you're still generating 8 A. Do I have a -- 9 new -- new contacts. 9 Q. A sense of how many Houlihan/Lawrence 10 Q. Okay. 10 agents were involved in the transactions that fall 11 A. And there are only so many relatives 11 within the class in this lawsuit? 12 and friends that you have. 12 A. Well, I know that there were 13 Q. Sure, but you're -- 13 approximately 10,000 transactions that were 14 A. But -- 14 questioned. And some of them could have been 15 Q. But your client source over the years 15 single agents. And the majority of them are double 16 the more -- the more you provide good service to 16 agents, so I would -- I would -- I would not 17 your clients, the more clients you have that are 17 speculate about how many. 18 providing you with good referrals, it can snowball? 18 Q. Okay. I was just asking. So you don't 19 A. Yes. 19 know the number? 20 Q. And that can become a very important 20 A. I don't know the number, no. 21 factor to developing -- 21 Q. Okay. 22 A. It's important, it's important. 22 A. I wouldn't -- and I don't have 23 MR. VEST: Mr. Cusack. 23 data -- enough data that tells me how does that 24 BY MR. MURRAY: 24 break down. 25 Q. That can become a very important factor 25 Q. Okay. Well, I will represent to you Page 278 Page 280 1 Thomas Cusack 1 Thomas Cusack 2 in becoming a successful real estate agent; do you 2 that the data has been produced in the case and the 3 agree with that? 3 agents have been identified and we've got various 4 MR. VEST: Objection, compound. 4 lists of agents, and it's over 1,300 5 THE WITNESS: It's a -- it's a continuing. 5 Houlihan/Lawrence agents involved in the various 6 It is contributing factor, yes. 6 transactions that fit within the class notice in 7 BY MR. MURRAY: 7 this case. 8 Q. Okay. Yesterday you mentioned, and you 8 Do you agree, sir, that it's 9 cite in your report, a source about an estimate 9 possible -- well, strike that. 10 that it would take 20 to 30 minutes to explain the 10 You have not reviewed e-mails or 11 disclosure form to a client; do you recall that? 11 communications involving all of those agents, have 12 A. Yes. 12 you? 13 Q. Do you have any idea what the typical 13 A. No. 14 time is that an agent in New York spends in 14 Q. And do you agree that it is possible, 15 explaining the disclosure form to their clients? 15 sir, that some of those agents gave disclosures 16 A. I don't -- I -- typical? 16 relating to dual agency and designated agency that 17 Q. Yeah, in actual practice, not what 17 you would find appropriate, do you think that is 18 someone has estimated, not what somebody thinks it 18 possible? 19 should be, what it actually is in practice? 19 A. I take exception to describe some. 20 MR. VEST: Objection, vague and ambiguous, 20 Q. At least one, do you agree that it 21 calls to speculation. 21 would be possible that an agent, one of those 22 THE WITNESS: It's very hard for me to say 22 agents provided a disclosure on dual and designated 23 the time, but as long as all of the -- as long 23 agency that you would find sufficient, do you think 24 as -- no, I don't have -- I don't have a -- I can't 24 that's possible? 25 answer that. 25 A. I would say it's possible. 8 (Pages 277 - 280) Veritext Legal Solutions www.veritext.com 888-391-3376 FILED: WESTCHESTER COUNTY CLERK 03/11/2024 11:36 AM INDEX NO. 60767/2018 NYSCEF DOC. NO. 1802 RECEIVED NYSCEF: 03/11/2024 Page 281 Page 283 1 Thomas Cusack 1 Thomas Cusack 2 Q. And -- 2 involved in the transactions in this case read the 3 A. But unlikely, unlikely on the basis of 3 prompt sheet, the script that you referred to in 4 if we're talking about that they were trained by 4 your materials? 5 Houlihan/Lawrence, and they -- they practiced 5 A. I don't know. 6 according to the Houlihan/Lawrence's practice, I 6 Q. How many of the 1,300 plus agents 7 can only comment about that. 7 involved in the transactions in this case used the 8 It would not -- it would be unlikely if they 8 prompt sheet, what you call a script, how many of 9 followed the Houlihan/Lawrence training that they 9 the 1,300 agents used that document to provide 10 would have made the -- I'd say it's highly unlikely 10 disclosures to their clients? 11 from the training. 11 A. I -- I don't know how many used it, but 12 Q. Okay. And which training are you 12 I do know how they did communicate the agency 13 talking about? 13 disclosure form to the consumer, six of the top 14 A. I'm talking about Houlihan/Lawrence's 14 agents how they communicated. 15 training. 15 Q. Well, sir, you know what was said in 16 Q. How many -- 16 the e-mails you reviewed from those six agents, 17 A. The -- go ahead. 17 correct? 18 Q. Go ahead. Finish your answer, I didn't 18 MR. VEST: Objection, mischaracterizes the 19 mean to interrupt you. 19 witness' testimony. 20 A. That's okay. The -- I look at the role 20 THE WITNESS: Yes. 21 plays, I look at the scripts, I look at the 21 BY MR. MURRAY: 22 handouts that they were instructed to give in 22 Q. You do not know what was orally said by 23 relation to agency, okay, in relation to agency. 23 any one of those six agents to any one of their 24 Not in relation to the other things that 24 clients? 25 they train their agents to do, but just in relation 25 MR. VEST: Objection, mischaracterizes the Page 282 Page 284 1 Thomas Cusack 1 Thomas Cusack 2 to those, and it is -- it is sorely deficient in 2 witness' testimony, vague as to know. 3 proper training. So that if they were following 3 THE WITNESS: I'm having a difficulty 4 this directive, which is what Houlihan/Lawrence 4 with -- with understanding how it -- how it relates 5 says is the standard procedure that we want you to 5 to what I testified. 6 perform when you're -- when you are using and 6 BY MR. MURRAY: 7 explaining agency, that my conclusion would be it's 7 Q. You just said, sir, that you do know 8 highly unlikely that if -- 8 how the six agents identified in your report 9 Q. All right. 9 communicated their disclosures. 10 A. So I'm saying if they went through the 10 And I'm asking -- and I'm just confirming 11 training, it is highly unlikely from my 11 what you testified to yesterday is you reviewed 12 perspective. 12 certain e-mails from those six agents, but you have 13 Q. All right. So of the 1,300 agents, 13 no idea what was said orally in a conversation 14 1,300 plus agents involved in the transactions at 14 between any one of those six agents and any one of 15 issue in this case, how many of them participated 15 their clients? 16 in any -- in the role plays that you just 16 A. No. 17 mentioned? 17 MR. VEST: Objection, mischaracterizes the 18 A. I don't know. 18 witness' testimony from yesterday and in his 19 Q. How many of the 1,300 agents 19 report. 20 at -- involved in the transactions in this case 20 THE WITNESS: Because -- because it 21 received the prompt sheet which you referred to in 21 mischaracterizes it, because you're not -- you're 22 your report in your affidavit as the script, how 22 not saying they constantly. The managers of the 23 many of those agents received that document? 23 company constantly said that it's the most 24 A. I don't know. 24 misunderstood, avoided, neglected, and abused part 25 Q. How many of the 1,300 plus agents 25 of our business. 9 (Pages 281 - 284) Veritext Legal Solutions www.veritext.com 888-391-3376 FILED: WESTCHESTER COUNTY CLERK 03/11/2024 11:36 AM INDEX NO. 60767/2018 NYSCEF DOC. NO. 1802 RECEIVED NYSCEF: 03/11/2024 Page 285 Page 287 1 Thomas Cusack 1 Thomas Cusack 2 It's very, very difficult, we need to be 2 A. Yes. 3 able to do it properly. And they brought in 3 Q. Do you have any reason to believe, sir, 4 trainers from HGAR, they brought in Cummings, a 4 that HGAR is in some kind of conspiratorial 5 lawyer from -- from HGAR to do training on to 5 agreement with Houlihan/Lawrence to trick 6 designate or not to designate. They felt the need, 6 Houlihan/Lawrence agents into misunderstanding dual 7 we need training in all of the communications. 7 agency and designated agency? 8 BY MR. MURRAY: 8 MR. VEST: Objection, argumentative. 9 Q. So, sir, why did Houlihan/Lawrence, why 9 THE WITNESS: Miss? 10 would they bring in training from outside resources 10 BY MR. MURRAY: 11 from HGAR, what is HGAR? 11 Q. You don't think that, do you, sir? 12 A. It's -- it's the holiday -- or it's the 12 MR. VEST: Objection. 13 Valley's board of realtors association. 13 THE WITNESS: No, I don't understand. 14 Q. The Hudson? 14 BY MR. MURRAY: 15 A. Hudson Gateway Board of Realtors. 15 Q. Sure. 16 Q. Okay. And it's an outside entity 16 A. Where did you get this from what I was 17 unrelated to Houlihan/Lawrence? 17 saying. 18 A. No, no, no, no, not unrelated. It is a 18 Q. Because a moment ago, sir, you said 19 membership organization where I would speculate 19 that Houlihan/Lawrence brings in outside trainers 20 that most of those -- most of those licensees, as 20 to teach its agents about how to deal with dual and 21 in Houlihan/Lawrence, if they want to participate 21 designated agency, correct? 22 in the multiple listing system must belong to a 22 A. Yes. 23 realtor association. 23 Q. And one of those outside entities is 24 Q. Sir -- 24 HGAR, correct? 25 A. So I'm saying that it -- it would be 25 A. Yes, which is a -- Page 286 Page 288 1 Thomas Cusack 1 Thomas Cusack 2 highly unlikely for me to say that they were not 2 Q. And, sir, do you think HGAR when it was 3 members of HGAR and they -- they use HGAR as a 3 brought in to train Houlihan/Lawrence agents was 4 source of lobbying, they use HGAR as a source of 4 brought in to train them incorrectly with their 5 helping them in their practice. 5 obligations under New York law? 6 And -- and Houlihan/Lawrence can call upon 6 A. No. 7 HGAR and their legal department to come in and add 7 Q. Okay. So my question to you is if you 8 validity to explaining agency. 8 think that Houlihan/Lawrence was intentionally 9 Q. So let me ask you this. First of all, 9 directing its agents to miss describe the risks of 10 you talked about NYSAR yesterday, correct? 10 dual and designated agency to their clients, why 11 A. Yes. 11 were they bringing in HGAR to provide training to 12 Q. NYSAR is a realtor association? 12 their agents? 13 A. Yes. 13 MR. VEST: Objection, assumes facts, lacks 14 Q. It's a member -- 14 foundation, mischaracterizes the witness' 15 A. That the state, that's a state 15 testimony. 16 association. 16 THE WITNESS: Okay. So let me go back. 17 Q. It's a membership association? 17 MR. VEST: And argumentative. 18 A. Member, yes. 18 THE WITNESS: Okay. So let me back up. And 19 Q. It does lobbying on behalf of realtors? 19 my reference was to Don Cummings who came in in 20 A. Yeah. 20 2015. But prior to that in 2011 Hagerty, who was 21 Q. Yes? 21 the -- I believe the executive director of HGAR and 22 A. Yes. 22 Alt decided they were going to do a training 23 Q. It provides a document that you say is 23 program to help the agents to understand it. 24 a useful tool in explaining dual and designated 24 And at that juncture they were dealing with 25 agency to consumers, correct? 25 undivided loyalty as part of the -- part of the 10 (Pages 285 - 288) Veritext Legal Solutions www.veritext.com 888-391-3376 FILED: WESTCHESTER COUNTY CLERK 03/11/2024 11:36 AM INDEX NO. 60767/2018 NYSCEF DOC. NO. 1802 RECEIVED NYSCEF: 03/11/2024 Page 349 Page 351 1 Thomas Cusack 1 Thomas Cusack 2 the article Mr. Gotto said that there had been 2 start and it's got to be informed consent in 3 discussions between NYSAR and the Department of 3 writing. 4 State; is that right? 4 BY MR. MURRAY: 5 A. Uh-huh. 5 Q. Sir, is this -- the legal memorandum is 6 Q. Yes? 6 the one that's entitled be wary of dual agency, 7 A. Yes. 7 legal memorandum LI -- 8 Q. And some of the opinions you've given 8 A. I have to -- 9 in this case are in part based on discussions that 9 Q. -- 12. 10 you've had with people at the Department of State; 10 A. Again, I have to go back and look at 11 is that correct, in part? 11 that. That -- yes, but as amended, because 12 A. In part, but not particularly for this. 12 it's -- it -- it follows a sequence when these 13 Q. Now -- 13 things come out, but I would -- I would want to 14 A. But there's something that I could say 14 look at that before we answer. 15 that as you read this, you passed over a sentence. 15 MR. VEST: And my objection is calls for 16 It said in order to minimize the potential for 16 speculation. 17 liability, all notices should be in writing and 17 BY MR. MURRAY: 18 made at the time of negotiations or immediately 18 Q. And I'll -- I'll just represent to you 19 thereafter, but it's got to be -- it's got to be in 19 I'm looking at a document on my computer, legal 20 writing. 20 memorandum LI12, be wary of dual agency. 21 Q. Well, sir. 21 And at the end it says updated February of 22 A. Yes, okay. 22 2020, is that the legal memorandum that you have in 23 Q. In fairness, the sentence that you just 23 mind? 24 read says, in order to minimize liability, it 24 MR. VEST: Objection, calls for speculation, 25 doesn't say it's required, it's giving practical 25 lacks foundation, asked and answered. Page 350 Page 352 1 Thomas Cusack 1 Thomas Cusack 2 advice to agents and brokers about what would be a 2 THE WITNESS: I have to see the document, 3 good idea from a risk management perspective. 3 because, yeah. 4 It is not saying that you are required to 4 BY MR. MURRAY: 5 give all notices in writing, because, sir, that 5 Q. Sir, on Exhibit 316 in the third 6 would conflict with what he said right above there. 6 paragraph on page 1, do you see a reference by 7 MR. VEST: Objection. 7 Mr. Gotto to legal memorandum LI12, be wary of dual 8 BY MR. MURRAY: 8 agency; do you see that? 9 Q. That the notice -- that the notice can 9 A. Uh-huh. 10 be by telephone. 10 Q. Yes? 11 THE WITNESS: He says. 11 A. Yes. 12 MR. VEST: Objection, argumentative. 12 Q. Now, do you remember, were there any 13 Mr. Cusack -- 13 amendments to that legal memorandum between the 14 THE WITNESS: Okay. I'm saying Anthony 14 third quarter of 2010 and 2020? 15 Gotto says this. 15 A. I -- I'm trying to remember this. 16 BY MR. MURRAY: 16 MR. VEST: And, sir, I'm going to give you 17 Q. And Anthony Gotto says based on 17 the same caution I gave earlier, do not speculate. 18 conversations that NYSAR has had with the 18 If you have a -- a recollection, you're more than 19 Department of State. 19 willing to -- or able to provide it. 20 MR. VEST: Objection, mischaracterizes the 20 THE WITNESS: I -- I can't. 21 document, assumes facts, overbroad. 21 MR. VEST: Do not speculate. 22 THE WITNESS: But the -- the -- okay. I'm 22 THE WITNESS: Yeah, I can't, I can't 23 in -- I would once again state that in my document 23 remember, but... 24 it's got to be according to -- according to a legal 24 MR. VEST: You've answered the question. 25 memorandum, it's got to be before the negotiations 25 THE WITNESS: I can't remember. 26 (Pages 349 - 352) Veritext Legal Solutions www.veritext.com 888-391-3376 FILED: WESTCHESTER COUNTY CLERK 03/11/2024 11:36 AM INDEX NO. 60767/2018 NYSCEF DOC. NO. 1802 RECEIVED NYSCEF: 03/11/2024 Page 353 Page 355 1 Thomas Cusack 1 Thomas Cusack 2 BY MR. MURRAY: 2 trying to see if there was evidence indicating 3 Q. Sir, is it your recollection that the 3 whether that single agent was acting as a dual 4 legal memorandum that you were previously 4 agent or whether the buyer was unrepresented; is 5 discussing, whatever that legal memorandum was that 5 that your general understanding? 6 you were remembering, did that specifically deals 6 MR. VEST: Objection