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NYSCEF DOC. NO. 582 RECEIVED NYSCEF: 01/22/2019
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK
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BRANDSWAY HOSPITALITY, LLC, a/k/a Index No. 652637/2013
BRANDSWAY HOSPITALITY , INDIEFORK, LLC
And MATTHEW LEVINE,
Plaintiffs,
-against-
DELSHAH CAPITAL LLC, MICHAEL K. SHAH,
and VICTOR JUNG
Defendants.
.--------------------------- X
DEFENDANTS'
REPLY MEMORANDUM OF LAW
DEFENDANTS'
IN FURTHER SUPPORT OF MOTION FOR SUMMARY
JUDGMENT AND TO STRIKE THE COMPLAINT
Dated: January 22, 2019
Garden City, New York
Cordova & Schwartzman, LLP
Attorneys for Defendants
DELSHAH CAPITAL LLC, MICHAEL K. SHAH
666 Old Country Road, Suite 700
Garden City, New York 11530
(516)741-0070
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INTRODUCTION
Defendants DELSHAH CAPITAL LLC ("Delshah Capital") and MICHAEL K. SHAH
("Shah") (Shah and/or Delshah Capital are collectively referred to as "Delshah") respectfully
submit this reply memorandum of law in further support of their cross-motion for sur=y
Plaintiffs'
judgment, or, in the alternative, to strike the Complaint for spoliation of evidence and
Plaintiffs'
complete and utter failure to abide by the Court's disclosure Order.
PRELIMINARY STATEMENT
Plaintiffs'
motion for partial summary judgment should be denied in itsentirety, and
Defendants'
cross-motion granted as (1) the undisputed facts provided below prove that
Plaintiffs were terminated "for cause"; (2) Plaintiffs spoliated evidence and ignored the Court's
disclosure Order; and (3) Plaintiffs offer no law in opposition to Delshah's motion, other than
Plaintiffs' Judgment."
boilerplate "Standard for Summary
Rather than actually address Dcishah's legal and factual arguments, Plaintiffs submit the
affidavit of motion Matthew Levine, dated December 10, 2018 (the "Levine Aff."), in response
to Delshah's cross-for summary judgment and other relief. In lieu of responding to the
allegations and arguments set forth in Delshah's motion papers, Levine goes on a rant espousing
his virtues and his claims to success, and smeariñg nearly anyone and everyone affiliated with
Sons of Essex ("SoE"). His vicious attacks on individuals knows no bounds, and astonishingly
he even goes so far as to attack the husband of Delshah's accountant (Levine Aff., page 34,
footnote 24), who clearly has nothing to do with this litigation. Levine's affidavit is nothing
more than a diatribe, written to inflict substantial harm on Delshah and SoE. Fairly stated,
Plaintiffs have engaged in a deliberate and sustained process of attempting to destroy the
reputation of anyone affiliated with Delshah and Sons of Essex, publicly, through e-filing
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Plaintiffs'
Levine's affidavits, and most recent affidavit is simply further evidence of their
malevolent intent.
In Levine's affidavit, he spends the bulk of his time defending his claim that, but, for
him, SOE would not have been successful, and that he far exceeded the requirements of the
Defendants'
metrics. Levine clings to the metrics claim as he cannot refute specific allegations as
Plaintiffs'
to theft and dishonesty and misappropriation of SOE's assets. Throughout his affidavit
"prove"
he relies on projections and estimates to Plaintiffs met the metrics while making broad
statements of purported wrongdoing by Delshah and anyone else he can possibly name,
Plaintiffs'
ostensibly to support claims. Levine mischaracterizes and misidentifies the evidence
Defeñdâñts'
that Plaintiffs rely on to support their motion, and ignores the specific allegations as
to Plaintiffs theft and dishonesty and misappropriation of SOE's assets.
Defendants'
As is demonstrated below, claims that Plaintiffs were terminated for cause
due to theft and dishonesty and the misappropriation of SOE's assets are nothing new. Plaintiffs
knew that they were terminated for those reasons as they are provided for in Delshah's Letter of
Termination dated April 2013, and Defendants have provided Plaintiffs with the documents to
prove the theft and dishonesty. Moreover, Plaintiffs had an obligation to abide by the Court's
direction to protect evidence, and abide by this Court's order to produce documents. As Plaintiffs
Defendants'
failed to dispute allegations and chose instead to ignore them and to ignore the
Courts' Plaintiffs'
instructions and Order, Complaint should be dismissed or stricken.
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ARGUMENT
POINT 1
PLAINTIFFS'
FIRST CAUSE OF ACTION
FOR BREACH OF CONTRACT SHOULD BE DISMISSED
Plaintiffs'
motion for summary judgment should be denied, and Delshah's cross-motion
Plaintiffs'
to dismiss firstcause of action for breach of contract should be granted as T!üisti,"s
cause'
do not deny the facts upon which Delshah term!.u:cd Brandsway 'for due to theft and
dhhenestF! Pursuant to the terms of the Management and Operations Agreement with Plaintiff
Brandsway Hospitality (the "Agreemeñt"), Delshâh hired Brandsway to operate and manage SoE
but subject to termination for, inter alia, Brandsway's theft or dishonesty. See, Agreement, page
9; a copy of the Agreement is annexed hereto as Exhibit B. Set forth below are numerous
Plaintiffs'
exampics of theft and dishonesty, which, among other reasons, served as a basis for
cause."
terminating Brandsway "for Significantly, Plaintiffs do not deny the allegations as set
forth below, and, therefore, admit to stealing from SoE. Thus, as Delshah properly terminated
Plaintiffs'
the Agreement due to theft and dishonesty, Plaintiffs cause of action for breach of
contract should be dismissed.
cause"
A. Plaintiffs were terminated "for as they stole from SoE.
i. The $2,500 check.
Plaintiffs'
In moving to dismiss firstcause of action, Delshah submitted the Affidavit of
James Choung, SoE's Director of Operations. NYSCEF Doc. No. 440; for the Court's
convenience a copy of Mr. Choung's affidavit is annexed hereto as Exhibit C. In his affidavit,
Mr. Choung sets forth specific facts with documentary evidence showing that during 2012,
Plaintiffs demanded that SoE issue Levine a check for $2,500, cWming that money spent by
liquor company sales representatives at SoE should simply be given to Levine, ostensibly to help
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pay the expenses for a birthday party that Levine threw for himself at SoE. Mr. Choung advised
Levine that he could not issue the check, and, indeed, Mr. Choung sent Levine an email advising
stealing."
him that issuing such a check is "basically Mr. Choung refused to issue the $2,500
check to Plaintiffs as it was improper to single out certain payments to SoE and simply give that
money to Levine. These liquor company sales representatives patronized SoE, and the income
belonged to SoE, not Plaintiffs.
Nonetheless, to circumvent Mr. Choung's refusal to issue the check, Levine
surreptitiously included the $2.500 amount in a check he directed Mr. Choung to issue to him for
$4,272.41! Copies of Mr. Choung's email exchange with Levine and the check are annexed
hereto as Exhibit G, and, importantly, this email was included as exhibit CC to Delshah's
moving papers (NYSCEF Doc. No. 472). This was documented theft, plain and simple.
Plaintiffs'
Despite Delshah's specific fact allegation that actions in taking this money
constituted theft, Pisistitis do not dens these facts! As Plaintiffs do not dispute these factual
allegations showing that they stole from SoE, these facts are deemed admitted by Plaintiffs.
Tortorello v. Carlin, 260 A.D.2d 201, 206; 688 N.Y.S.2d 64, 68 (1st Dep't. 1999) (On a motion
for summary judgment "[u]ncontradicted facts are deemed admitted"); John William Costello
Assocs. v. Std. Metals Corp., 99 A.D.2d 227, 229; 472 N.Y.S.2d 325, 326 (1st Dep't 1984)
("[F]acts appearing in the movant's papers, which the opposing party does not controvert, may be
Plaintiffs'
deemed to be admitted"). Thus, based upon failure to deny these specific facts,
Delshah's motion should be granted. Town of Angelica v. Smith, 89 A.D.3d 1547, 1550; 933
N.Y.S.2d 480, 483 (1st Dep't 2011) ("In the event that the opposing party fails to submit
evidentiary facts to controvert the facts set forth in the movant's papers, the facts in those papers
may be deemed admitted and summary judgment grâñted inasmuch as no triable issue of fact
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exists").
Rather than dispute these specific allegations, Plaintiffs make a simple conclusory
allegation that there was no theft, without any specifics. E.g., Levine Aff., ¶ 19. However, "[i]t
judgment."
is elementary that conclusory assertions will not defeat summary Freedman v.
Chemical Constr. Corp., 43 N.Y.2d 260, 264, 372 N.E.2d 12, 14, 401 N.Y.S.2d 176, 179 (1977).
Plaintiffs'
Rather, because Delshah has set forth specific facts with evidentiary proof of theft, it
was incumbent upon Plaintiffs to produce evidence that they did not steal; Plaintiffs; general
denial is insufficient to create a fact issue so as to avoid summary judgment. Gould v. McBride,
36 A.D.2d 706, 707, 319 N.Y.S.2d 125, 126 (1st Dep't1971) ("A bare denial, unsupported by
evidence to the contrary, is insufficient to create a factual issue."); Vazquez v. Orange County
Rehabilitation Ctr., 157 Misc. 2d 917, 921, 598 N.Y.S.2d 897, 899 (Sup Ct orange County 1993)
("It is well established that an opponent of a summary judgment motion must avoid mere
conclusory allegations and lay bare his or her proof."); Price v. Cushman & Wakefield. Inc., 808
F. Supp. 2d 670, 685, (S.D.N.Y. 2011) ("In seeking to show that there is a genuine issue of
material fact for trial,the non-moving party cannot rely on mere allegations, denials, conjectures
or conclusory statements, but must present affirmative and specific evidence showing that there
is a genuine issue for trial").
Here, in the face of Delshah's specific fact allegations and documents showing that
Plaintiffs took money to which they were not entitled, Plaintiffs offer nothing more than a
conclusory denial of geñeral theft, and, critically, they do not address Delshah's specific
Plaintiffs'
allegations. general denials are insufficient to create a fact issue. Accordingly,
Delshah's motion should be granted, and the First Cause of Action should be dismissed. Federal
Deposit Ins. Corp. v. Jacobs, 185 A.D.2d 913, 913, 587 N.Y.S.2d 978 (2d Dep't 1992) ("The
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defendants'
responsive papers contained bald, conclusory allegations, which, even ifbelievable,
are not enough to defeat a motion for summary judgment").
Plaintiffs further attempt to avoid the consequence of their actions by claiming that
"defense"
Levine was never able to write SoE checks. Levine Aff., ¶ 19. However, this is
disingenuous, as Levine had the authority to direct the issuance of checks, as is conclusively
proven by his email dated February 27, 2012, in which he directs Mr. Choung to issue him the
check for these funds! See, Ex. G. Clearly, Plaintiffs seek to mislead the Court in an attempt to
deflect from the admitted truth of their dishonest actions.
Furthermore, Plaintiffs do not address Delshah's legal arguments based upon these
specific facts, and thus they are deemed to have conceded Delshah's legal arguments! Genger v
Genger, 2015 NY Slip Op 30008(U), 20; 2015 N.Y. Misc. LEXIS 29, *29 (Sup Ct NY County
2015) ("In their opposition brief, [the defendants] do not address or contest the argument, and
thus are deemed to have conceded it.").
Accordingly, as Plaintiffs do not dispute Delshah's specific factual allegations that they
stole this from SoE-or were at the least dishonest- or Delshah's legal
money very argumcñts,
Plaintiffs'
Delshah has conclusively shown that itproperly terminated the Agreement due to theft
Plaintiffs'
and dishonesty, and, as such, claim for breach of contract should be dismissed, S_ee,
Agreement, page 9; Ex. B,
ii. Brandsway wrongfully inflates its monthly payment check
and steals from SoE.
Mr. Choung also set forth the facts to show that Plaintiffs wrongfully inflated
Brandsway's monthly paymcñt check, thereby stealing thousands of dollars from SoE. See, Ex.
C, ¶13. Once again, Plaintiffs do not deny these detailed factual allegations, supported by
documentary proof, or even address these factual allegations, and these allegations are deemed
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Plaintiffs'
admitted, conclusively proving that Delshah properly temiiñated the Agreement due to
theft and dishonesty.
The following facts are set forth in Mr. Choung's affidavit. and they are not disputed!
S_ee, Ex. C. Pursuant to the Agreement, Brandsway was to receive a monthly payment of
$15,000. he, Agreement; Ex B. However, Levine convinced Mr. Shah to have SoE cover the
cost of Brandsway's employee, Kristen Shirley, as she was allegedly spending all of her time
working for SoE. Accordingly, Bnuidsway took an increased payment of $17,500, rather than
$15,000, from SoE on a monthly basis, ostensibly to cover Ms. Shirley's salary. In December
2012, Kristen Shirley resigned, and as a result, Delshah reduced the monthly payment to
Brandsway back to $15,000 from $17,500.
However, despite this explicit reduction, Plaintiffs ignored the reduction, and continued
to issue checks, first, for an additional $2,500.00 per month, and then, more brazenly for the full
amount of $17,500 per month, instead of the correct amount of $15,000 per month. This
conversion of funds continued from January 2013 to March 2013. Copies of the checks for
$15,000 and then $17,500 after Shirley's resignation are annexed attached hereto as Exhibit H;
copies of these checks were included as exhibit DD to Delshah's moving papers. NYSCEF Doc.
No. 473. This was. again, a clear example of Plaintiffs stealing from SoE, and again. Plaintiffs
do not disnute these allegations! Indeed, Plaintiffs do not even address these allegations.
Plaintiffs'
Rather, Plaintiffs seek to deflect by alleging that Delshah is raising the issue of
theft for the first time. Levine Aff., $19 ("Defendants also assert for the first time that Plaintiffs
stole from SOE . .. ."). However, this statement is demonstrably false, based upon the letter
dated April 23, 2013 by Delshah terminating Brandsway (the "Termination Letter") for cause. A
copy of the Termination Letter is annexed hereto as Exhibit D; see also, NYSCEF Doc. No.
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412.1
A simple reading of the Termination Letter shows that Dcishah specifically refers to
Brandsway's acts of dishonesty and theft in paragraph 3(c) which reads that "Brandsway and its
agents have improperly made payments to itself in excess of any agreed upon compensation by
issuing checks drawn of accounts of Sons of Essex and Cocktail Bodega beyond the scope of
authority."
their authority and/or without
Plaintiffs'
Furthermore, these soecific allegations of theft of these amounts were set forth
in April 2013! When the action entitled 133 Essex Restaurant, LLC v. Brandsway Hospitality,
651629/20132
Supreme Court, New York County, Index No. (the "Related Action") was
commenced, Delshah sought an injunction against Plaintiffs, which was granted by the
Honorable Peter O. Sherwood, J.S.C. S_ee, Exhibit I. In support of the application for that
injunction, Mr. Choung submitted an affidavit in which he set forth that Plaintiffs wrongfully
took the above-referenced $2,500 from SoE. See, Affidavit of James Choung sworn to on April
30, 2013, at¶ 12; a copy of Mr. Choung's April 2013 affidavit is annexed hereto as Exhibit K.
Mr. Choung further sets forth that Plaintiffs took an inflated monthly payment from SoE, under
the guise of paying their employee. S_ee, Ex. K ¶ 13.
Plaintiffs' "new"
Thus, despite claim that their theft from SoE is somehow a claim,
Plaintiffs have known that Brandsway was terminated for theft for nearly six years, and, clearly,
they are well aware from April 2013 that Brandsway was terminated for the misappropriation of
monies belonging to SoE, among other reasons. Their claim that allegations of theft and
claim"
dishonesty by Plaintiffs is somehow a "new is belied by the documentary proof.
Whether the misappropriated amount is $2,500 or thousands the undisputed-
more,
indeed, admitted--facts are that Plaintiffs misappropriated monies from SoE. Accordingly,
1Plaintiffsincluded theTermi ati Letter intheir moving papers.
2 the same and isalso before the Court.
This action,arisingfrom facts Agreement, pciidiiig
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Plaintiffs'
Delshah properly terminated the Agreement due to theft and dishonesty, and, as such,
Plaintiff's claim for breach of contract should be dismissed. S_ee, Agreement, page 9; Ex. B.
iii. Plaintiffs misappropriated food and beverage bclcnging to SoE.
Plaintiffs'
Despite claim that the issue of their dishonesty and theft is "new", Delshah
termiñated Brandsway for a ñümber of reasons, including theft and dishonest as set forth above.
cause"
In paragraph 3(e) of the Termination Letter, Plaintiffs were terminated "for because
"Brandsway and itsagents have given away excessive amounts of free food and beverage to their
amount."
friends and colleagues in excess of any approved he, Termination Letter, Ex. D.
As is set forth in Delshah's moving papers, Plaintiffs treated SoE as their personal
"Plaintiffs' table"
fiefdom, and they would not allow SoE's hostess to seat anyone at even
though itwould be leftempty on some nights. This forced SoE to turn away many high paying
customers. To leave a large booth empty from Thursday through Saturday cost SoE perhaps as
much as $2,250.00 per week. Plaintiffs also thought nothing of serving their friends without
charge, costing SoE perhaps as much as $1,500.00 on some nights. See, Ex. C, ¶ 14. Fairly
Plaintiffs' "their" "comping"
stated, holding of table, which was SoE's asset, and the of their
friends were simply other forms of theft and misappropriation from SoE, and Brandsway was
properly terminated "for cause". Again, critically, Plaintiffs do not dispute these allegations, and
cause" Plaintiffs'
as these facts are undisputed and Brandsway was terminated "for First Cause
of Action for breach of contract should be dismissed.
Plaintiffs'
iv. misappropriated the ownership of SoE
domain names and other web addresses.
Pursuant to the Termination Letter, Plaintiffs were terminated, inter alia, as "Brandsway
and itsagents have improperly registered or otherwise made claim to ownership of the domain
Bodega."
name, social media names, handles, and/or hashtags for Sons of Essex and Cocktail
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See, Termination letter,Ex. D.
Delshah learned that Plaintiffs had registered allof SoE's media addresses in Plaintiff's
name and not under SoE, despite the fact that the domain names, social media names, handles
and/or hashtags (the "SoE Domain") were the assets of SoE. Even at the time of termination
when Delshah demañded that Plaintiffs relinquish control over the SoE Domain -- and the server
the SoE emails -- Plaintiffs refused to do so and denied SoE access to their own emails
hosting
and to their own reservation site. Plaintiffs admit that Brandsway filed the domain name under
its own name and have continued to pay for it. Levine Aff., page 27. Brandsway has clearly
done this to the detriment of SoE, and as a means to maintain control over the SoE Domain and
prevent access to it.Brandsway has been out of SoE for almost six years so there is no rational
basis for denying access to the SoE Domaiñ except to cause harm to SoE.
Furthermore, as is set forth in Mr. Choung's accompanying affidavit, after Brandsway
was terminated, Plaintiffs changed all of the passwords on the SoE email server used by the staff
accoüñts!3
and mañagers so that they could no longer access their email This, of course, caused
havoc at SoE as staff members were then unable to either access or use their SoE email
addresses.4
Plaintiffs improperly taking control over and making claim to the ownership of SoE's
Plaintiffs'
assets is another instance of theft and dishonesty, and, accordingly, Plaintiffs were
cause." Plaintiffs'
properly terminated "for As such, claim for breach of contract should be
dismissed.
3 The Plaintiffschanged theemail passwords disproves Levine's claim thatMr.
factthat conclusively Choung
deleted his own emails afterhe was named as a defendant inthe litigation.
4 As Plaintiffs'
isset forthin Point 3 below, deletionof the emails has only made itmore difficultforDelshah and
Plaintiffs'
SoE toprove that claims of hisrole and actions atSoE are not trueand accurate.
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Essex"
v. Plaintiffs steal the trademark "Sons of and website demeim
Essex"
Delshah also sets forth that Plaintiffs have dishonestly stolen the "Sons of
trademark, asserting that the trademark is the property of SoE and that Plaintiffs are "holding it
hostage"
until Delshah pays him for the trademark.
Astonishingly, in opposition, Plaintiffs do not deny that the trademark belones to SoE!
Levine Aff. ¶ 18. Rather, as an excuse for not delivering the trademark, Plaintiffs assert that they
would not deliver ituntil an operating agreement for SoE was executed. Levine Aff. ¶ 18.
Plaintiffs' "proof"
offer as exhibit P to their papers an email dated March 2012 as that
Brandsway was allegedly allowed to maintaiñ possession of the trademark. For the Court's
conveñience, a copy of this email is annexed hereto as Exhibit F. However, the offered email
Essex"
does not concern the "Sons of trademark, but rather, the Subject Line clearly references
LLC"
"Cocktail Bodega IP an unrelated entity! This is nothing more than añother example of
Plaintiffs submitting unrelated or misidentified documeñts to the Court with the hope that the
sheer volume of submissions will allow these misleading documents to escape scrutiny.
Plaintiffs assert that the theft of the trademark could not be a reason for Brandsway's
now."
termination, and Levine actually writes that "an issue was never raised until Levine Aff. ¶
18. However, the theft of the trademark was a specific ground for Brandsway's terminvion as
set forth in the Termination Letter! In that letter,as a specific ground for terminating
Brandsway, Delshah set forth:
Brandsway and its agents have attempted to convert certain valuable intellectual
property assets by, among other actions, registering the trademarks and/or trade
names for Sons of Essex . .. .
See, Termination Letter, paragraph 3(a); Ex. D.
Delshah further demanded that
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Brandsway and its agents are required to immediately execute and deliver to
Delshah any and all documents and/or instruments sufficient to transfer and/or
assign the ownership and/or control of any and all trademarks, trade names . .. for
Sons of Essex.
See, Termination Letter, final page; Ex. D.
As the Court can see, Delshah specifically enumerated Brandsway's theft of the
Plaintiffs'
trademark as a specific ground for Brandsway's termination. claim that the issue of
the trademark is a new or recent issue is demonstrably false.
Essex"
The trademark "Sons of is not the property of Plaintiffs, and they do not deny
Delshah's claim to ownership. Their refusal to deliver itto Delshah certainly constitutes "theft
dishonesty"
and under the Agreement, thereby proving that Delshah's termination of Brandsway
cause"
"for under the Agreement. See, Agreement, page 9; Ex. B. Accordingly, Delshah's
termination of Brandsway was proper.
vi. Conclusion
Plaintiffs have failed to dispute the facts set forth by Delshah proving that Brandsway
cause" Plaintiffs'
was terminated "for due to numerous acts other than their failure to meet the
metrics. Plaintiffs charted their course in deciding to ignore the allegations set forth in Delshah's
"new"
papers. Worse, Plaintiffs go so far as to claim that Delshah's allegations are somehow
despite the fact that Delshah's claims were asserted in the Letter of Termination in 2013.
Nonetheless, Plaintiffs come before this Court claiming that they are owed 20 million
dollars in damages arising from their 18 month or so tenure! Plaintiffs were hired to manage the
food and beverage operations of SoE, and not to treat SoE as their own personal fiefdom, taking
anything they wanted, whenever they wanted. Tellingly, SoE has continued to operate without
Plaintiffs'
Plaintiffs for nearly six years, despite relentless efforts to destroy SoE as a business
and to harm the reputation of the staff that works for SoE. The evidence is undisputed that
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cause"
Plaintiffs were terminated "for and Plaintiff's First Cause of Action for breach of contract
should be dismissed.
B. Plaintiffs ieopardized SoE's liquor license.
Delshah also moved on the ground that Levine filed a complaint with the New York State
Liquor Authority (the "SLA") regardiñg SoE making serious accusations of SLA violations, all
of which occurred while Brandsway was managing SoE. In opposition, Plaintiffs assert as a
defense that these actions cannot be a ground to terminate the Agreement because the SLA
investigations occurred after Plaintiff Brandsway was terminated. Levine Aff., $10. However,
this argument is disingenuous, as the events under investigation occurred during Brandsway's
management of SoE, regardless of when the investigations occurred.
In an attempt to deflect, Plaintiffs then set forth a listof coiñplaiñts against SoE, all of
which p
Preview
FILED: NEW YORK COUNTY CLERK 01/22/2019 11:31 AM INDEX NO. 652637/2013 NYSCEF DOC. NO. 582 RECEIVED NYSCEF: 01/22/2019 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK -----------------------------------------------------X BRANDSWAY HOSPITALITY, LLC, a/k/a Index No. 652637/2013 BRANDSWAY HOSPITALITY , INDIEFORK, LLC And MATTHEW LEVINE, Plaintiffs, -against- DELSHAH CAPITAL LLC, MICHAEL K. SHAH, and VICTOR JUNG Defendants. .--------------------------- X DEFENDANTS' REPLY MEMORANDUM OF LAW DEFENDANTS' IN FURTHER SUPPORT OF MOTION FOR SUMMARY JUDGMENT AND TO STRIKE THE COMPLAINT Dated: January 22, 2019 Garden City, New York Cordova & Schwartzman, LLP Attorneys for Defendants DELSHAH CAPITAL LLC, MICHAEL K. SHAH 666 Old Country Road, Suite 700 Garden City, New York 11530 (516)741-0070 1 of 30 FILED: NEW YORK COUNTY CLERK 01/22/2019 11:31 AM INDEX NO. 652637/2013 NYSCEF DOC. NO. 582 RECEIVED NYSCEF: 01/22/2019 INTRODUCTION Defendants DELSHAH CAPITAL LLC ("Delshah Capital") and MICHAEL K. SHAH ("Shah") (Shah and/or Delshah Capital are collectively referred to as "Delshah") respectfully submit this reply memorandum of law in further support of their cross-motion for sur=y Plaintiffs' judgment, or, in the alternative, to strike the Complaint for spoliation of evidence and Plaintiffs' complete and utter failure to abide by the Court's disclosure Order. PRELIMINARY STATEMENT Plaintiffs' motion for partial summary judgment should be denied in itsentirety, and Defendants' cross-motion granted as (1) the undisputed facts provided below prove that Plaintiffs were terminated "for cause"; (2) Plaintiffs spoliated evidence and ignored the Court's disclosure Order; and (3) Plaintiffs offer no law in opposition to Delshah's motion, other than Plaintiffs' Judgment." boilerplate "Standard for Summary Rather than actually address Dcishah's legal and factual arguments, Plaintiffs submit the affidavit of motion Matthew Levine, dated December 10, 2018 (the "Levine Aff."), in response to Delshah's cross-for summary judgment and other relief. In lieu of responding to the allegations and arguments set forth in Delshah's motion papers, Levine goes on a rant espousing his virtues and his claims to success, and smeariñg nearly anyone and everyone affiliated with Sons of Essex ("SoE"). His vicious attacks on individuals knows no bounds, and astonishingly he even goes so far as to attack the husband of Delshah's accountant (Levine Aff., page 34, footnote 24), who clearly has nothing to do with this litigation. Levine's affidavit is nothing more than a diatribe, written to inflict substantial harm on Delshah and SoE. Fairly stated, Plaintiffs have engaged in a deliberate and sustained process of attempting to destroy the reputation of anyone affiliated with Delshah and Sons of Essex, publicly, through e-filing 1 2 of 30 FILED: NEW YORK COUNTY CLERK 01/22/2019 11:31 AM INDEX NO. 652637/2013 NYSCEF DOC. NO. 582 RECEIVED NYSCEF: 01/22/2019 Plaintiffs' Levine's affidavits, and most recent affidavit is simply further evidence of their malevolent intent. In Levine's affidavit, he spends the bulk of his time defending his claim that, but, for him, SOE would not have been successful, and that he far exceeded the requirements of the Defendants' metrics. Levine clings to the metrics claim as he cannot refute specific allegations as Plaintiffs' to theft and dishonesty and misappropriation of SOE's assets. Throughout his affidavit "prove" he relies on projections and estimates to Plaintiffs met the metrics while making broad statements of purported wrongdoing by Delshah and anyone else he can possibly name, Plaintiffs' ostensibly to support claims. Levine mischaracterizes and misidentifies the evidence Defeñdâñts' that Plaintiffs rely on to support their motion, and ignores the specific allegations as to Plaintiffs theft and dishonesty and misappropriation of SOE's assets. Defendants' As is demonstrated below, claims that Plaintiffs were terminated for cause due to theft and dishonesty and the misappropriation of SOE's assets are nothing new. Plaintiffs knew that they were terminated for those reasons as they are provided for in Delshah's Letter of Termination dated April 2013, and Defendants have provided Plaintiffs with the documents to prove the theft and dishonesty. Moreover, Plaintiffs had an obligation to abide by the Court's direction to protect evidence, and abide by this Court's order to produce documents. As Plaintiffs Defendants' failed to dispute allegations and chose instead to ignore them and to ignore the Courts' Plaintiffs' instructions and Order, Complaint should be dismissed or stricken. 2 3 of 30 FILED: NEW YORK COUNTY CLERK 01/22/2019 11:31 AM INDEX NO. 652637/2013 NYSCEF DOC. NO. 582 RECEIVED NYSCEF: 01/22/2019 ARGUMENT POINT 1 PLAINTIFFS' FIRST CAUSE OF ACTION FOR BREACH OF CONTRACT SHOULD BE DISMISSED Plaintiffs' motion for summary judgment should be denied, and Delshah's cross-motion Plaintiffs' to dismiss firstcause of action for breach of contract should be granted as T!üisti,"s cause' do not deny the facts upon which Delshah term!.u:cd Brandsway 'for due to theft and dhhenestF! Pursuant to the terms of the Management and Operations Agreement with Plaintiff Brandsway Hospitality (the "Agreemeñt"), Delshâh hired Brandsway to operate and manage SoE but subject to termination for, inter alia, Brandsway's theft or dishonesty. See, Agreement, page 9; a copy of the Agreement is annexed hereto as Exhibit B. Set forth below are numerous Plaintiffs' exampics of theft and dishonesty, which, among other reasons, served as a basis for cause." terminating Brandsway "for Significantly, Plaintiffs do not deny the allegations as set forth below, and, therefore, admit to stealing from SoE. Thus, as Delshah properly terminated Plaintiffs' the Agreement due to theft and dishonesty, Plaintiffs cause of action for breach of contract should be dismissed. cause" A. Plaintiffs were terminated "for as they stole from SoE. i. The $2,500 check. Plaintiffs' In moving to dismiss firstcause of action, Delshah submitted the Affidavit of James Choung, SoE's Director of Operations. NYSCEF Doc. No. 440; for the Court's convenience a copy of Mr. Choung's affidavit is annexed hereto as Exhibit C. In his affidavit, Mr. Choung sets forth specific facts with documentary evidence showing that during 2012, Plaintiffs demanded that SoE issue Levine a check for $2,500, cWming that money spent by liquor company sales representatives at SoE should simply be given to Levine, ostensibly to help 3 4 of 30 FILED: NEW YORK COUNTY CLERK 01/22/2019 11:31 AM INDEX NO. 652637/2013 NYSCEF DOC. NO. 582 RECEIVED NYSCEF: 01/22/2019 pay the expenses for a birthday party that Levine threw for himself at SoE. Mr. Choung advised Levine that he could not issue the check, and, indeed, Mr. Choung sent Levine an email advising stealing." him that issuing such a check is "basically Mr. Choung refused to issue the $2,500 check to Plaintiffs as it was improper to single out certain payments to SoE and simply give that money to Levine. These liquor company sales representatives patronized SoE, and the income belonged to SoE, not Plaintiffs. Nonetheless, to circumvent Mr. Choung's refusal to issue the check, Levine surreptitiously included the $2.500 amount in a check he directed Mr. Choung to issue to him for $4,272.41! Copies of Mr. Choung's email exchange with Levine and the check are annexed hereto as Exhibit G, and, importantly, this email was included as exhibit CC to Delshah's moving papers (NYSCEF Doc. No. 472). This was documented theft, plain and simple. Plaintiffs' Despite Delshah's specific fact allegation that actions in taking this money constituted theft, Pisistitis do not dens these facts! As Plaintiffs do not dispute these factual allegations showing that they stole from SoE, these facts are deemed admitted by Plaintiffs. Tortorello v. Carlin, 260 A.D.2d 201, 206; 688 N.Y.S.2d 64, 68 (1st Dep't. 1999) (On a motion for summary judgment "[u]ncontradicted facts are deemed admitted"); John William Costello Assocs. v. Std. Metals Corp., 99 A.D.2d 227, 229; 472 N.Y.S.2d 325, 326 (1st Dep't 1984) ("[F]acts appearing in the movant's papers, which the opposing party does not controvert, may be Plaintiffs' deemed to be admitted"). Thus, based upon failure to deny these specific facts, Delshah's motion should be granted. Town of Angelica v. Smith, 89 A.D.3d 1547, 1550; 933 N.Y.S.2d 480, 483 (1st Dep't 2011) ("In the event that the opposing party fails to submit evidentiary facts to controvert the facts set forth in the movant's papers, the facts in those papers may be deemed admitted and summary judgment grâñted inasmuch as no triable issue of fact 4 5 of 30 FILED: NEW YORK COUNTY CLERK 01/22/2019 11:31 AM INDEX NO. 652637/2013 NYSCEF DOC. NO. 582 RECEIVED NYSCEF: 01/22/2019 exists"). Rather than dispute these specific allegations, Plaintiffs make a simple conclusory allegation that there was no theft, without any specifics. E.g., Levine Aff., ¶ 19. However, "[i]t judgment." is elementary that conclusory assertions will not defeat summary Freedman v. Chemical Constr. Corp., 43 N.Y.2d 260, 264, 372 N.E.2d 12, 14, 401 N.Y.S.2d 176, 179 (1977). Plaintiffs' Rather, because Delshah has set forth specific facts with evidentiary proof of theft, it was incumbent upon Plaintiffs to produce evidence that they did not steal; Plaintiffs; general denial is insufficient to create a fact issue so as to avoid summary judgment. Gould v. McBride, 36 A.D.2d 706, 707, 319 N.Y.S.2d 125, 126 (1st Dep't1971) ("A bare denial, unsupported by evidence to the contrary, is insufficient to create a factual issue."); Vazquez v. Orange County Rehabilitation Ctr., 157 Misc. 2d 917, 921, 598 N.Y.S.2d 897, 899 (Sup Ct orange County 1993) ("It is well established that an opponent of a summary judgment motion must avoid mere conclusory allegations and lay bare his or her proof."); Price v. Cushman & Wakefield. Inc., 808 F. Supp. 2d 670, 685, (S.D.N.Y. 2011) ("In seeking to show that there is a genuine issue of material fact for trial,the non-moving party cannot rely on mere allegations, denials, conjectures or conclusory statements, but must present affirmative and specific evidence showing that there is a genuine issue for trial"). Here, in the face of Delshah's specific fact allegations and documents showing that Plaintiffs took money to which they were not entitled, Plaintiffs offer nothing more than a conclusory denial of geñeral theft, and, critically, they do not address Delshah's specific Plaintiffs' allegations. general denials are insufficient to create a fact issue. Accordingly, Delshah's motion should be granted, and the First Cause of Action should be dismissed. Federal Deposit Ins. Corp. v. Jacobs, 185 A.D.2d 913, 913, 587 N.Y.S.2d 978 (2d Dep't 1992) ("The 5 6 of 30 FILED: NEW YORK COUNTY CLERK 01/22/2019 11:31 AM INDEX NO. 652637/2013 NYSCEF DOC. NO. 582 RECEIVED NYSCEF: 01/22/2019 defendants' responsive papers contained bald, conclusory allegations, which, even ifbelievable, are not enough to defeat a motion for summary judgment"). Plaintiffs further attempt to avoid the consequence of their actions by claiming that "defense" Levine was never able to write SoE checks. Levine Aff., ¶ 19. However, this is disingenuous, as Levine had the authority to direct the issuance of checks, as is conclusively proven by his email dated February 27, 2012, in which he directs Mr. Choung to issue him the check for these funds! See, Ex. G. Clearly, Plaintiffs seek to mislead the Court in an attempt to deflect from the admitted truth of their dishonest actions. Furthermore, Plaintiffs do not address Delshah's legal arguments based upon these specific facts, and thus they are deemed to have conceded Delshah's legal arguments! Genger v Genger, 2015 NY Slip Op 30008(U), 20; 2015 N.Y. Misc. LEXIS 29, *29 (Sup Ct NY County 2015) ("In their opposition brief, [the defendants] do not address or contest the argument, and thus are deemed to have conceded it."). Accordingly, as Plaintiffs do not dispute Delshah's specific factual allegations that they stole this from SoE-or were at the least dishonest- or Delshah's legal money very argumcñts, Plaintiffs' Delshah has conclusively shown that itproperly terminated the Agreement due to theft Plaintiffs' and dishonesty, and, as such, claim for breach of contract should be dismissed, S_ee, Agreement, page 9; Ex. B, ii. Brandsway wrongfully inflates its monthly payment check and steals from SoE. Mr. Choung also set forth the facts to show that Plaintiffs wrongfully inflated Brandsway's monthly paymcñt check, thereby stealing thousands of dollars from SoE. See, Ex. C, ¶13. Once again, Plaintiffs do not deny these detailed factual allegations, supported by documentary proof, or even address these factual allegations, and these allegations are deemed 6 7 of 30 FILED: NEW YORK COUNTY CLERK 01/22/2019 11:31 AM INDEX NO. 652637/2013 NYSCEF DOC. NO. 582 RECEIVED NYSCEF: 01/22/2019 Plaintiffs' admitted, conclusively proving that Delshah properly temiiñated the Agreement due to theft and dishonesty. The following facts are set forth in Mr. Choung's affidavit. and they are not disputed! S_ee, Ex. C. Pursuant to the Agreement, Brandsway was to receive a monthly payment of $15,000. he, Agreement; Ex B. However, Levine convinced Mr. Shah to have SoE cover the cost of Brandsway's employee, Kristen Shirley, as she was allegedly spending all of her time working for SoE. Accordingly, Bnuidsway took an increased payment of $17,500, rather than $15,000, from SoE on a monthly basis, ostensibly to cover Ms. Shirley's salary. In December 2012, Kristen Shirley resigned, and as a result, Delshah reduced the monthly payment to Brandsway back to $15,000 from $17,500. However, despite this explicit reduction, Plaintiffs ignored the reduction, and continued to issue checks, first, for an additional $2,500.00 per month, and then, more brazenly for the full amount of $17,500 per month, instead of the correct amount of $15,000 per month. This conversion of funds continued from January 2013 to March 2013. Copies of the checks for $15,000 and then $17,500 after Shirley's resignation are annexed attached hereto as Exhibit H; copies of these checks were included as exhibit DD to Delshah's moving papers. NYSCEF Doc. No. 473. This was. again, a clear example of Plaintiffs stealing from SoE, and again. Plaintiffs do not disnute these allegations! Indeed, Plaintiffs do not even address these allegations. Plaintiffs' Rather, Plaintiffs seek to deflect by alleging that Delshah is raising the issue of theft for the first time. Levine Aff., $19 ("Defendants also assert for the first time that Plaintiffs stole from SOE . .. ."). However, this statement is demonstrably false, based upon the letter dated April 23, 2013 by Delshah terminating Brandsway (the "Termination Letter") for cause. A copy of the Termination Letter is annexed hereto as Exhibit D; see also, NYSCEF Doc. No. 7 8 of 30 FILED: NEW YORK COUNTY CLERK 01/22/2019 11:31 AM INDEX NO. 652637/2013 NYSCEF DOC. NO. 582 RECEIVED NYSCEF: 01/22/2019 412.1 A simple reading of the Termination Letter shows that Dcishah specifically refers to Brandsway's acts of dishonesty and theft in paragraph 3(c) which reads that "Brandsway and its agents have improperly made payments to itself in excess of any agreed upon compensation by issuing checks drawn of accounts of Sons of Essex and Cocktail Bodega beyond the scope of authority." their authority and/or without Plaintiffs' Furthermore, these soecific allegations of theft of these amounts were set forth in April 2013! When the action entitled 133 Essex Restaurant, LLC v. Brandsway Hospitality, 651629/20132 Supreme Court, New York County, Index No. (the "Related Action") was commenced, Delshah sought an injunction against Plaintiffs, which was granted by the Honorable Peter O. Sherwood, J.S.C. S_ee, Exhibit I. In support of the application for that injunction, Mr. Choung submitted an affidavit in which he set forth that Plaintiffs wrongfully took the above-referenced $2,500 from SoE. See, Affidavit of James Choung sworn to on April 30, 2013, at¶ 12; a copy of Mr. Choung's April 2013 affidavit is annexed hereto as Exhibit K. Mr. Choung further sets forth that Plaintiffs took an inflated monthly payment from SoE, under the guise of paying their employee. S_ee, Ex. K ¶ 13. Plaintiffs' "new" Thus, despite claim that their theft from SoE is somehow a claim, Plaintiffs have known that Brandsway was terminated for theft for nearly six years, and, clearly, they are well aware from April 2013 that Brandsway was terminated for the misappropriation of monies belonging to SoE, among other reasons. Their claim that allegations of theft and claim" dishonesty by Plaintiffs is somehow a "new is belied by the documentary proof. Whether the misappropriated amount is $2,500 or thousands the undisputed- more, indeed, admitted--facts are that Plaintiffs misappropriated monies from SoE. Accordingly, 1Plaintiffsincluded theTermi ati Letter intheir moving papers. 2 the same and isalso before the Court. This action,arisingfrom facts Agreement, pciidiiig 8 9 of 30 FILED: NEW YORK COUNTY CLERK 01/22/2019 11:31 AM INDEX NO. 652637/2013 NYSCEF DOC. NO. 582 RECEIVED NYSCEF: 01/22/2019 Plaintiffs' Delshah properly terminated the Agreement due to theft and dishonesty, and, as such, Plaintiff's claim for breach of contract should be dismissed. S_ee, Agreement, page 9; Ex. B. iii. Plaintiffs misappropriated food and beverage bclcnging to SoE. Plaintiffs' Despite claim that the issue of their dishonesty and theft is "new", Delshah termiñated Brandsway for a ñümber of reasons, including theft and dishonest as set forth above. cause" In paragraph 3(e) of the Termination Letter, Plaintiffs were terminated "for because "Brandsway and itsagents have given away excessive amounts of free food and beverage to their amount." friends and colleagues in excess of any approved he, Termination Letter, Ex. D. As is set forth in Delshah's moving papers, Plaintiffs treated SoE as their personal "Plaintiffs' table" fiefdom, and they would not allow SoE's hostess to seat anyone at even though itwould be leftempty on some nights. This forced SoE to turn away many high paying customers. To leave a large booth empty from Thursday through Saturday cost SoE perhaps as much as $2,250.00 per week. Plaintiffs also thought nothing of serving their friends without charge, costing SoE perhaps as much as $1,500.00 on some nights. See, Ex. C, ¶ 14. Fairly Plaintiffs' "their" "comping" stated, holding of table, which was SoE's asset, and the of their friends were simply other forms of theft and misappropriation from SoE, and Brandsway was properly terminated "for cause". Again, critically, Plaintiffs do not dispute these allegations, and cause" Plaintiffs' as these facts are undisputed and Brandsway was terminated "for First Cause of Action for breach of contract should be dismissed. Plaintiffs' iv. misappropriated the ownership of SoE domain names and other web addresses. Pursuant to the Termination Letter, Plaintiffs were terminated, inter alia, as "Brandsway and itsagents have improperly registered or otherwise made claim to ownership of the domain Bodega." name, social media names, handles, and/or hashtags for Sons of Essex and Cocktail 9 10 of 30 FILED: NEW YORK COUNTY CLERK 01/22/2019 11:31 AM INDEX NO. 652637/2013 NYSCEF DOC. NO. 582 RECEIVED NYSCEF: 01/22/2019 See, Termination letter,Ex. D. Delshah learned that Plaintiffs had registered allof SoE's media addresses in Plaintiff's name and not under SoE, despite the fact that the domain names, social media names, handles and/or hashtags (the "SoE Domain") were the assets of SoE. Even at the time of termination when Delshah demañded that Plaintiffs relinquish control over the SoE Domain -- and the server the SoE emails -- Plaintiffs refused to do so and denied SoE access to their own emails hosting and to their own reservation site. Plaintiffs admit that Brandsway filed the domain name under its own name and have continued to pay for it. Levine Aff., page 27. Brandsway has clearly done this to the detriment of SoE, and as a means to maintain control over the SoE Domain and prevent access to it.Brandsway has been out of SoE for almost six years so there is no rational basis for denying access to the SoE Domaiñ except to cause harm to SoE. Furthermore, as is set forth in Mr. Choung's accompanying affidavit, after Brandsway was terminated, Plaintiffs changed all of the passwords on the SoE email server used by the staff accoüñts!3 and mañagers so that they could no longer access their email This, of course, caused havoc at SoE as staff members were then unable to either access or use their SoE email addresses.4 Plaintiffs improperly taking control over and making claim to the ownership of SoE's Plaintiffs' assets is another instance of theft and dishonesty, and, accordingly, Plaintiffs were cause." Plaintiffs' properly terminated "for As such, claim for breach of contract should be dismissed. 3 The Plaintiffschanged theemail passwords disproves Levine's claim thatMr. factthat conclusively Choung deleted his own emails afterhe was named as a defendant inthe litigation. 4 As Plaintiffs' isset forthin Point 3 below, deletionof the emails has only made itmore difficultforDelshah and Plaintiffs' SoE toprove that claims of hisrole and actions atSoE are not trueand accurate. 10 11 of 30 FILED: NEW YORK COUNTY CLERK 01/22/2019 11:31 AM INDEX NO. 652637/2013 NYSCEF DOC. NO. 582 RECEIVED NYSCEF: 01/22/2019 Essex" v. Plaintiffs steal the trademark "Sons of and website demeim Essex" Delshah also sets forth that Plaintiffs have dishonestly stolen the "Sons of trademark, asserting that the trademark is the property of SoE and that Plaintiffs are "holding it hostage" until Delshah pays him for the trademark. Astonishingly, in opposition, Plaintiffs do not deny that the trademark belones to SoE! Levine Aff. ¶ 18. Rather, as an excuse for not delivering the trademark, Plaintiffs assert that they would not deliver ituntil an operating agreement for SoE was executed. Levine Aff. ¶ 18. Plaintiffs' "proof" offer as exhibit P to their papers an email dated March 2012 as that Brandsway was allegedly allowed to maintaiñ possession of the trademark. For the Court's conveñience, a copy of this email is annexed hereto as Exhibit F. However, the offered email Essex" does not concern the "Sons of trademark, but rather, the Subject Line clearly references LLC" "Cocktail Bodega IP an unrelated entity! This is nothing more than añother example of Plaintiffs submitting unrelated or misidentified documeñts to the Court with the hope that the sheer volume of submissions will allow these misleading documents to escape scrutiny. Plaintiffs assert that the theft of the trademark could not be a reason for Brandsway's now." termination, and Levine actually writes that "an issue was never raised until Levine Aff. ¶ 18. However, the theft of the trademark was a specific ground for Brandsway's terminvion as set forth in the Termination Letter! In that letter,as a specific ground for terminating Brandsway, Delshah set forth: Brandsway and its agents have attempted to convert certain valuable intellectual property assets by, among other actions, registering the trademarks and/or trade names for Sons of Essex . .. . See, Termination Letter, paragraph 3(a); Ex. D. Delshah further demanded that 11 12 of 30 FILED: NEW YORK COUNTY CLERK 01/22/2019 11:31 AM INDEX NO. 652637/2013 NYSCEF DOC. NO. 582 RECEIVED NYSCEF: 01/22/2019 Brandsway and its agents are required to immediately execute and deliver to Delshah any and all documents and/or instruments sufficient to transfer and/or assign the ownership and/or control of any and all trademarks, trade names . .. for Sons of Essex. See, Termination Letter, final page; Ex. D. As the Court can see, Delshah specifically enumerated Brandsway's theft of the Plaintiffs' trademark as a specific ground for Brandsway's termination. claim that the issue of the trademark is a new or recent issue is demonstrably false. Essex" The trademark "Sons of is not the property of Plaintiffs, and they do not deny Delshah's claim to ownership. Their refusal to deliver itto Delshah certainly constitutes "theft dishonesty" and under the Agreement, thereby proving that Delshah's termination of Brandsway cause" "for under the Agreement. See, Agreement, page 9; Ex. B. Accordingly, Delshah's termination of Brandsway was proper. vi. Conclusion Plaintiffs have failed to dispute the facts set forth by Delshah proving that Brandsway cause" Plaintiffs' was terminated "for due to numerous acts other than their failure to meet the metrics. Plaintiffs charted their course in deciding to ignore the allegations set forth in Delshah's "new" papers. Worse, Plaintiffs go so far as to claim that Delshah's allegations are somehow despite the fact that Delshah's claims were asserted in the Letter of Termination in 2013. Nonetheless, Plaintiffs come before this Court claiming that they are owed 20 million dollars in damages arising from their 18 month or so tenure! Plaintiffs were hired to manage the food and beverage operations of SoE, and not to treat SoE as their own personal fiefdom, taking anything they wanted, whenever they wanted. Tellingly, SoE has continued to operate without Plaintiffs' Plaintiffs for nearly six years, despite relentless efforts to destroy SoE as a business and to harm the reputation of the staff that works for SoE. The evidence is undisputed that 12 13 of 30 FILED: NEW YORK COUNTY CLERK 01/22/2019 11:31 AM INDEX NO. 652637/2013 NYSCEF DOC. NO. 582 RECEIVED NYSCEF: 01/22/2019 cause" Plaintiffs were terminated "for and Plaintiff's First Cause of Action for breach of contract should be dismissed. B. Plaintiffs ieopardized SoE's liquor license. Delshah also moved on the ground that Levine filed a complaint with the New York State Liquor Authority (the "SLA") regardiñg SoE making serious accusations of SLA violations, all of which occurred while Brandsway was managing SoE. In opposition, Plaintiffs assert as a defense that these actions cannot be a ground to terminate the Agreement because the SLA investigations occurred after Plaintiff Brandsway was terminated. Levine Aff., $10. However, this argument is disingenuous, as the events under investigation occurred during Brandsway's management of SoE, regardless of when the investigations occurred. In an attempt to deflect, Plaintiffs then set forth a listof coiñplaiñts against SoE, all of which p