Preview
FILED: KINGS COUNTY CLERK 01/22/2019 01:10 PM INDEX NO. 507940/2016
NYSCEF DOC. NO. 107 RECEIVED NYSCEF: 01/22/2019
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF KINGS
---------------- ----------------------------------------------X
PATRICIA ROMANO, Index No. 507940/2016
Plaintiff,
- against -
SHIEL MEDICAL LABORATORY, INC. a/k/a BIM
MEDICAL, INC., SPECTRA LABORATORIES, INC.,
and JACK BASCH,
Defendants.
--------------------- ---------------------- ----X
DEFENDANT SHIEL MEDICAL LABORATORY, INC. a/k/a BIM MEDICAL, INC.'S
MEMORANDUM IN SUPPORT OF ITS MOTION TO STRIKE JURY DEMAND
GOLDBERG WEPRIN FINKEL
GOLDSTEIN LLP
Kevin J. Nash, Esq.
Attorneys for Defendant
Shiel Medical Laboratory, Inc.
22nd
1501 Broadway, FlOOr
New York, New York 10036
(212) 221-5700
1 of 9
FILED: KINGS COUNTY CLERK 01/22/2019 01:10 PM INDEX NO. 507940/2016
NYSCEF DOC. NO. 107 RECEIVED NYSCEF: 01/22/2019
This Memorandum of Law is respectfully submitted on behalf of the remaining
defendant, Shiel Medical Laboratory, Inc. ("Shiel Laboratory") in support of its motion pursuant
("Plaintiff"
to CPLR 4101 and 4102(c) to strike the demand by Plaintiff, Patricia Romano or
"Romano") for a jury trial. The motion is based upon the fact that Romano's legal claims for
breach of contract have now been dismissed, and her remaining causes of action sound in equity,
for which there is no jury trial right under well settled constitutional and legal principles.
Accordingly, Plaintiff's demand for a jury trial should be stricken.
PRELIMINARY STATEMENT
While Plaintiff's complaint originally included causes of action for breach of contract,
the procedural posture of the case changed when Defendants were granted partial summary
judgment. Specifically, by Order entered on September 26, 2018 (the "Summary Judgment
Ruling"), this Court granted partial summary judgment dismissing Romann's breach of contract
claim in its entirety, dismissing all claims against the individual defendant, Jack Basch, and
leaving only alternate causes of action for quantum meruit and unjust êñrichment as against Shiel
Laboratory.1 "A"
A copy of the Summary Judgment Ruling is annexed as Exhibit to the
Affirmation of Kevin J. Nash, Esq., submitted in support of this Motion.
The dismissal of Romano's main claim for breach of contract has important repercussions
regarding jury trial rights. At this juncture, Romano is only left with alleged equitable claims for
quantum meruit and unjust enrichment, for which a right to a jury trial does not exist under the
New York Constitution, Article I, Section 2, and CPLR 4101 and 4102.
1 Defendants'
Since motion included a request for summary judgment dismissing the fourth
cause of action for promissory estoppel, in the absence of a specific provision in the Summary
Judgment Ruling preserving the cause of action for promissory estoppel, Defendant submits that
this claim has been dismissed as well, notwithstanding that following the entry of the Summary
Judgment Ruling, Plaintiff filed an amended complaint including a cause of action for
promissory estoppel with the other causes of action for quantum meruit and unjust enrichment.
2 of 9
FILED: KINGS COUNTY CLERK 01/22/2019 01:10 PM INDEX NO. 507940/2016
NYSCEF DOC. NO. 107 RECEIVED NYSCEF: 01/22/2019
Moreover, even without dismissal of Romano's legal cause of action for breach of
contract, she waived her right to a jury trial when Romano included both legal and equitable
claims in her initial complaint. As the Second Department has instructed:
The deliberate joinder of claims for legal and equitable relief arising out of
the same transaction amounts to a waiver of the right to demand a jury
trial; see CPLR 4102 [c]). Here, the Supreme Court properly determined that the
plaintiff waived her right to a jury trial by joining legal and equitable causes of
action arising from the same transaction and seeking both legal and equitable
defendants'
relief. Accordingly, the court properly granted that branch of the
motion which was to strike the plaintiffs demand for a trial by jury.
Zutrau v. ICE Sys., Inc., 128 A.D.3d 1058, 1059-60 (2d Dep't 2015) (internal quotation marks
and case citations omitted).
In fact, this waiver rule is more than 100 years old, having been set down by the
legendary Benjamin Cardozo while sitting on the New York Court of Appeals, in Di Menna v.
Cooper & Evans Co., 220 N.Y. 391, 396 (1917), where he held that "The rule is fundamental
that where a plaintiff seeks legal and equitable relief in respect of the same wrong, his right to
lost."
trial by jury is Thus, Romano's decision to plead alternate causes of action carries
important limitations on her jury trial rights.
BACKGROUND FACTS
Shiel Laboratory operated a blood testing laboratory in Brooklyn, before the company
was sold to Spectra Laboratories, Inc. in 2013. Prior to the sale, Romano served as Shiel
Laboratory's Medical Director starting in 2009. Although Romano did not have an employment
agreement, she nevertheless commenced suit alleging that she was entitled to an alleged bonus
predicated upon the sale of the company calculated on a sliding scale formula.
The Defendants disputed Romano's entitlement to this bonus and successfully argued
that there was never an agreement reached by the parties on any bonus compensation. Indeed the
2
3 of 9
FILED: KINGS COUNTY CLERK 01/22/2019 01:10 PM INDEX NO. 507940/2016
NYSCEF DOC. NO. 107 RECEIVED NYSCEF: 01/22/2019
months'
parties exchanged a number of unexecuted term sheets over a period of eighteen time
without finalizing an agreement. Instead, Romano received a payment of $4.0 million following
the sale, consistent with the terms of her original offer of employment. Not satisfied, however,
Romano instituted this action seeking an additional bonus. Following discovery, Defendants
moved for summary judgment seeking to dismiss certain of Romano's claims. This motion was
granted in part, predicated upon the core finding that was never an agreement reached on a
bonus, much less the amount of any bonus.
In the wake of the Summary Judgment Ruling, Romano is still pursuing alternate claims
for quantum meruit and unjust enrichment against Shiel Laboratory. Both of these claims are
steeped in equity and raise impediments with respect to Romano's right to a jury trial. The Court
2019.2
has scheduled the trial on the remaining causes of action to commence on March 18,
LEGAL ARGUMENT
Point I: Romano's Jury Trial Demand Should Be Stricken
A. Constitutional Rights
In New York, a trial by jury is available in those cases where the relief sought is legal in
nature, but not for matters which are historically equitable. See, 7C Carmody-Wait 2d § 49:14
("As a general rule, a jury trial is available in the law actions, as opposed to those evolved in
chancery (equity), which continue to be triable by the court."). This is a function of Article I,
Section 1 of the New York State Constitution, which guarantees trial by jury, as modified by
2
This motion is timely, as "a motion to strike a demand for a jury trial may be made at any time
(1"
up to the opening of trial". Moyal v. Sleppin, 139 A.D.3d 605 Dep't 2016); Haber v. Cohen,
25 Misc. 3d 1216(A) (S.Ct. Kings Co. 2009), affd, 74 A.D.3d 1282 (2d Dep't 2010) (same).
Notably, Shiel Laboratory specifically reserved its right to bring the instant motion as part of the
communications with Romano's counsel and the Court in scheduling a trial date.
3
4 of 9
FILED: KINGS COUNTY CLERK 01/22/2019 01:10 PM INDEX NO. 507940/2016
NYSCEF DOC. NO. 107 RECEIVED NYSCEF: 01/22/2019
Article I, Section 2 of the New York State Constitution, which provides for a waiver of that right
in certain circumstances:
Trial by jury in all cases in which it has heretofore been guaranteed by
constitutional provision shall remain inviolate forever; but a jury trial may be
waived by the parties in all civil cases in the manner to be prescribed by law.
N.Y. Constitution, Article I, Section 2.
Historically, the waiver of the guaranty to a trial by jury occurred when equitable, rather
than legal, claims were at issue. As the Second Department has explained:
In each instance it must be determined whether the nature and substance of
the claim for relief is in law or in equity. If in law and included among the cases
where jury trial is historically mandated by the Constitution or by statute, a jury
trial must be had on demand. If the relief demanded is traditionally cognizable in
equity there is no right to trial by jury for none was available at common law . . . .
Magill v. Dutchess Bank & Tr. Co., 150 A.D.2d 531, 531-32 (2d Dep't 1989) (internal quotation
marks and citations omitted).
The analysis of the underlying nature of the action focuses on the facts as pleaded, not the
demand for relief. Thus, the mere fact that Romano seeks a monetary recovery based on
equitable claims is not controlling on the jury trial question. Again, the Second Department
explained in Magill:
A party's entitlement to demand a jury trial is dependent upon the facts
pleaded, not the demand for relief . . . The critical consideration is whether the
facts stated show that the action is equitable or legal in nature. The fact that the
complaint demands a money judgment does not necessarily establish that there is
a right to a jury trial . . . .
Id., at 531. Accordingly, Romano's invocation of equitable claims nullifies her jury trial rights,
even though she seeks recovery of additional monies from Shiel Laboratory.
4
5 of 9
FILED: KINGS COUNTY CLERK 01/22/2019 01:10 PM INDEX NO. 507940/2016
NYSCEF DOC. NO. 107 RECEIVED NYSCEF: 01/22/2019
B. Jury Trial Rights are Subject to Waiver
Even guarantied jury trial rights can be waived where, as here, they are combined with
equitable claims arising out of the same transaction. See, CPLR 4102(c). Here, because
Romano knowingly asserted both legal and equitable claims arising out of the same transaction,
she is deemed to have waived her right to a jury trial. As quoted above, this rule dates back to a
decision by Judge Cardozo, writing for the Court of Appeals in 1917, more than a century ago.
Di Menna v. Cooper & Evans Co., 220 N.Y. 391, 396, 115 N.E. 993, 994 (1917). See, above, p.
2.
The rule has since been codified under CPLR 4102(c), which provides a waiver of the
right to a jury trial depending on whether legal and equitable claims have been asserted relating
to the same or different transaction. Where the transaction is the same, a knowing joinder of
legal and equitable claims for relief constitutes a waiver of the right to a jury trial on the legal
claims. See, A. J. Fritschy Corp. v. Chase Manhattan Bank, 36 A.D.2d 600, 600, 318 N.Y.S.2d
369, 370 (1971) ("The joinder by plaintiff of legal and equitable causes of action based upon the
same transaction effected a waiver of its right to trial by jury (CPLR 4102(c)"); Sullivan v.
Troser Mgmt., Inc., supra, 75 A.D.3d at 1060 ("It is well settled that plaintiffs deliberate joinder
of claims for legal and equitable relief arising out of the same transaction amounts to a waiver of
the right to demand a jury trial") (internal quotation marks and citations omitted); Kaplan v.
(1''
Long Island Univ., 116 A.D.2d 508, 509 Dep't 1986)("Under established principles, the
joinder of claims for legal and equitable relief amounts to a waiver of the right to demand a jury
(ISt
trial"); Tanne v. Tanne, 30 A.D.2d 956 Dep't 1968) (by reason of consolidation of legal and
equitable causes of action, "a waiver has resulted as to plaintiffs right to a trial by jury of the
issues involved in the law action. (Lavisch v. Schwartz, 235 App. Div. 18; CPLR 4102, subd.
5
6 of 9
FILED: KINGS COUNTY CLERK 01/22/2019 01:10 PM INDEX NO. 507940/2016
NYSCEF DOC. NO. 107 RECEIVED NYSCEF: 01/22/2019
[c].)"); Nat'l Grid Corp. Servs., LLC v. LeSchack & Grodensky, P.C., 41 Misc. 3d 977, 981
(S.Ct. Nassau Co. 2013)("The joinder by plaintiff of legal and equitable claims arising from the
same transaction results in a waiver of the right to trial by jury with respect to the legal claims
(Horizon Asset Mañagement v. Duffy, 106 A.D.3d 594, 967 N.Y.S.2d 17 [1st Dept. 2013] ).").
C. There is No Jury Trial Right with Respect to the Remaining Equitable Causes of
Action
Besides the waiver rules, since the Summary Judgment Ruling eliminated the legal
claims from the case, the remaining equitable claims are only triable by the Court under
traditional rules dating back to the common law. There can be no disputing that Romano's
remaining causes of action are equitable in nature. For example, with respect to a claim for
quantum meruit, in Williams v. Foubister, 176 Misc.2d 702 (Sup.Ct. 1998), the Court reviewed a
dispute over legal fees, and the question of whether the requirement for arbitration of the dispute
violated the Constitutional right to a jury trial, explaining:
The courts have consistently analyzed such cases as involving claims in
the nature of quantum meruit and thus held such actions to be equitable in nature
and therefore not mandating a right to jury trial. The cases have sometimes
confused the issue based upon a different stated claim but ultimately the law
applied is the settled law related to an equitable action to recover fees for the fair
and reasonable value of the services rendered by an attorney on behalf of a client.
(Internal citations omitted).
Williams v. Foubister, 176 Misc. 2d at 706. See also, Nat'l Grid Corp. Servs., LLC v. LeSchack
& Grodensky, P.C., supra, 41 Misc. 3d at 981 (denying jury trial based on finding that claim for
fees in quantum meruit is equitable in nature). See, also, Connolly v. Griffin, 201 A.D.2d 371,
(l"
372 Dep't 1994) ("inasmuch as plaintiff, in his fourth cause, seeks recovery under the
equitable doctrine of quantum meruit, he has no statutory right to a jury trial on that cause").
Similarly, Courts have found that claims for unjust enrichment are also equitable in
nature without jury rights. See, e.g., Nat'l Grid Corp. Servs., LLC v. LeSchack & Grodensky,
6
7 of 9
FILED: KINGS COUNTY CLERK 01/22/2019 01:10 PM INDEX NO. 507940/2016
NYSCEF DOC. NO. 107 RECEIVED NYSCEF: 01/22/2019
P.C., supra, 41 Misc. 3d at 981 ("National Grid's claim for unjust enrichment is also
an equitable remedy (IDT Corp. v. Morgan Stanley, 12 N.Y.3d 132, 142, 879 N.Y.S.2d 355, 907
N.E.2d 268 [2009]; NCJ Cleaners v. ALM Media, 48 A.D.3d 766, 852 N.Y.S.2d 384 [2d Dept.
2008])").
The arguably dismissed cause of action for promissory estoppel was also equitable in
nature. As the Third Department has explained, a claim for promissory estoppel is equitable in
nature because it does not seek to enforce an existing contract, but to fashion an equitable
remedy precisely because there was never a formal contract:
Plaintiff is not asking Supreme Court to enforce a contract that would
otherwise be enforceable but for lack of consideration, but to provide a remedy
where the underlying agreement fails for indefiniteness. The doctrine is not being
used defensively in support of contract rights but, instead, to create a new right in
the interests of justice with relief designed to achieve equity. Under these
circumstances, plaintiff is not entitled to the benefit of the bargain because there
was no bargain. (internal quotation marks and citations omitted) (emphasis
supplied)
Chfford R. Gray, Inc. v. LeChase Const. Servs., 51 A.D.3d 1169, 1171 (3d Dep't 2008).
In sum, Romano waived any right to trial by jury when she filed the initial complaint
both legal and equitable causes of action out of the same matter - the alleged
ceiiibining arising
entitlement to a perforniance bonus. To the extent there is any possible debate over this point,
with the ensuing dismissal of the legal branch of the case, the traditional rule that Romano has no
right to a jury trial on the equitable causes of action of quantum meruit and unjust enrichment
comes into play. Accordingly, the instant motion to strike the jury demand should be granted