Opinion
Index No.: 656608/2016
06-05-2018
THE BOARD OF MANAGERS OF 250 BOWERY CONDOMINIUM, Plaintiff, v. 250 VE LLC, VE EQUITIES LLC, JUSTIN EHRLICH, ZACHARY VELLA, VELLA GROUP LLC, DOUGLAS ELLIMAN, LLC, DOUGLAS ELLIMAN REALTY, LLC, MORRIS ADJMI ARCHITECTS, P.C., FOUNDATIONS GROUP, INC., and ICOR ASSOCIATES LLC, Defendants.
NYSCEF DOC. NO. 118
DECISION AND ORDER
Mot. Seq. Nos.: 001-004
O. PETER SHERWOOD, J. :
Motion sequences 001, 002, 003, and 004 are consolidated for disposition. This is an action by plaintiff the Board of Managers of 250 Bowery Condominium suing on behalf of purchasers of luxury residential condominium units located at 250 Bowery, New York, New York (the building) against various defendants to recover for alleged defects in the building and purported misrepresentations made by certain defendants to the general public about the building in order to sell units. Defendant Morris Adjmi Architects P.C. (Morris) moves, pursuant to CPLR 3211, to dismiss all claims against it (motion sequence 001). Defendant ICOR Associates, LLC (ICOR) moves, pursuant to CPLR 3211, to dismiss all claims against it (motion sequence 002). Defendants 250 VE LLC, VE Equities LLC, Vella Group LLC, Zachary Vella and Justin Ehrlich (together Sponsor Defendants) move, pursuant to CPLR 3211, to dismiss all claims against them except for the first cause of action alleging a claim for breach of contract (motion sequence 003). Defendant Foundations Group, Inc. (Foundations and together with Morris and ICOR, "Builder Defendants") moves, pursuant to CPLR 3211, to dismiss all claims against it (motion sequence 004).
BACKGROUND
This litigation arises from alleged construction defects in the building, which were discovered in 2016 after the water in a fire sprinkler pipe froze, causing the pipe to burst, and water to flood the building (Morris notice of motion, Schreckinger affirmation, exhibit B [Complaint], ¶ 66). The building is an eight-story structure containing 24 residential units and 2 commercial units (id., ¶ 38). While damage from the flooding was being repaired, plaintiff allegedly discovered defects in the building (id., ¶¶ 70-82). These conditions were purportedly inconsistent with the representations made by Sponsor Defendants, who marketed the building as a high-end luxury condominium (id., ¶¶ 26, 29, 49-58).
On October 1, 2012, Sponsor Defendants filed an offering plan (the Offering Plan) with the New York State Attorney General for the construction, renovation, and sale of units in the building (id., ¶ 38). The Offering Plan was certified by Sponsor Defendants in September 2012 (the Certification). Pursuant to the Offering Plan and in related advertisements, Sponsor Defendants represented and agreed that the building would be constructed in accordance with other provisions and specifications outlined in the Offering Plan, industry standards, and applicable zoning and building laws and regulations (id., ¶¶ 40-43, 48, 61). The commercial units were not part of the Offering Plan (id., ¶ 36). Morris was the architect of record with respect to the development and construction of the property and the condominium conversion of the building. Foundations was the general contractor performing the construction work for the condominium conversion of the building, and ICOR was the mechanical engineer.
On February 15, 2016, a fire sprinkler pipe in one of the penthouse units allegedly froze, burst, and flooded some of the residential units with over 80,000 gallons of water (id., ¶ 66). As a result of an investigation into the pipe bursting, plaintiff allegedly learned that the pipe lacked insulation, and that the bulkhead of the pipe also lacked insulation (id., ¶ 70, 73). This condition was systemic in the building and existed in all of the penthouse bulkheads (id., ¶ 71). Plaintiff also purportedly learned that inadequate water-proofing between the tiles and walls and improper sheetrock caused a growth of mold within the walls in all of the bathrooms in the residential units (id., ¶ 74, 76). In addition, plaintiff allegedly discovered design and construction defects regarding improperly designed / installed electrical boxes, subflooring, HVAC system, fire-stopping and roof flashing (id., ¶¶ 80-82). Plaintiff alleges it incurred millions of dollars in remediation costs and other damages, only a portion of which was paid by insurance (id., ¶¶ 68, 87).
On December 19, 2016, plaintiff commenced this action against defendants. The complaint alleges six causes of action which are as follows:
1) The first cause of action alleges breach of contract and breach of warranty against Sponsor Defendants for their failure to deliver the building in conformance with obligations undertaken pursuant to the Offering Plan (id., ¶¶ 88-96);
2) The second cause of action alleges negligence and gross negligence against Sponsor Defendants for negligently supervising the design and construction of the building and causing the existence of dangerous defective conditions, including conditions that do not comply with applicable law (id., ¶¶ 97-102);
3) The third cause of action alleges breach of contract against Builder Defendants, asserting that plaintiff and the residential unit owners were intended third party beneficiaries of the respective contracts to design and construct the building (id., ¶¶ 103-109);
4) The fourth cause of action alleges general negligence and gross negligence against Builder Defendants arising from a breach of their independent duties to design and construct the building without dangerous conditions which resulted in property and other damage to plaintiff and residential unit owners (id., ¶¶ 110-113);
5) The fifth cause of action alleges fraud and fraud in the inducement against all defendants based upon affirmative misrepresentations made in the Offering Plan and elsewhere concerning the quality of workmanship and details of the building's design and construction (id., ¶¶ 114-128); and
6) The sixth cause of action alleges violation of General Business Law sections 349 and 350 against Douglas Elliman, LLC and Douglas Elliman Realty, LLC (together Broker Defendants), Sponsor Defendants, Morris, and Foundations for engaging in deceptive trade practices and false advertising in connection with the marketing of the building through the offering plan, news media, websites, and television programming (id., ¶¶ 129-135).
Plaintiff withdrew its claims for breach of contract, fraud and fraud in the inducement, and violations of General Business Law sections 349 and 350 against all respective defendants except Sponsor Defendants (see oral argument tr, March 6, 2018 at 62; Sponsor Defendants' notice of motion, plaintiff opposition memorandum of law [Plaintiff Opp.] at 19). Therefore, the claims against Sponsor Defendants at issue in their motion are those for negligence and gross negligence, fraud and fraud in the inducement, and violations of General Business Law sections 349 and 350 (they do not move to dismiss the breach of contract claim), and the only remaining claims against Morris, ICOR, and Foundations are those for negligence and gross negligence.
DISCUSSION
The standard of review on a motion to dismiss pursuant to CPLR 3211 is well established. The court must assume the truth of the allegations in the pleading and "resolve all inferences which reasonably flow therefrom in favor of the pleader" (Sanders v Winship, 57 NY2d 391, 394 [1982]). "Under CPLR 3211 (a) (1), a dismissal is warranted only if the documentary evidence submitted conclusively establishes a defense to the asserted claims as a matter of law" (Leon v Martinez, 84 NY2d 83, 88 [1994]). Pursuant to CPLR 3211 (a) (7), "factual allegations that do not state a viable cause of action, that consist of bare legal conclusions, or that are inherently incredible or clearly contradicted by documentary evidence are not entitled to such consideration" (Skillgames, LLC v Brody, 1 AD3d 247, 250 [1st Dept 2003]). "Whether the plaintiff will ultimately be successful in establishing those allegations is not part of the calculus" (Landon v Kroll Lab. Specialists, Inc., 22 NY3d 1, 6 [2013], rearg denied 22 NY3d 1084 [2014] [internal quotation marks and citation omitted]).
A. Claims Against Sponsor Defendants
Sponsor Defendants initially moved to dismiss the negligence and gross negligence claims as against them but have since withdrawn this portion of their motion "without prejudice to seeking dismissal of said . . . cause of action at a later time" (Sponsor Defendants notice of motion, reply memorandum of law at 1). Accordingly, the motion to dismiss the second cause of action for negligence and gross negligence is denied without prejudice (see e.g. Credit Suisse Intl. v Urbi, Desarrollos Urbanos, S.A.B. de C.V., 41 Misc3d 601 [Sup Ct, NY County 2013]; Deer Consumer Prods., Inc. v Little Group, 37 Misc3d 1224[A], 2012 NY Slip Op 52157 [U] [Sup Ct, NY County 2012]).
Sponsor Defendants also move to dismiss the fifth cause of action alleging fraud and fraudulent inducement as against them. Plaintiff opposes the motion. To establish a fraud-based cause of action, the plaintiff must demonstrate a "'representation of a material existing fact, falsity, scienter, deception and injury'" (New York Univ. v Continental Ins. Co., 87 NY2d 308, 318 [1995], quoting Channel Master Corp. v Aluminum Ltd. Sales, 4 NY2d 403, 407 [1958] [emphasis in original]). "[T]he false representation relied upon must relate to a past or existing fact, or something equivalent thereto" (Zanani v Savad, 217 AD2d 696, 697 [2d Dept 1995]).
Sponsor Defendants argue that the fraud-based cause of action should be dismissed because it is duplicative of the breach of contract cause of action. A cause of action for fraud may be dismissed as duplicative of a cause of action for breach of contract when they both arise out of the same facts and allege the same damages (see J.E. Morgan Knitting Mills, Inc. v Reeves Bros., 243 AD2d 422, 423 [1st Dept 1997] [upholding dismissal of fraud claim where "fraud alleged [was] based on the same facts as . . . the contract claim and [was] not collateral to the contract and no damages [were] alleged that would not be recoverable under a contract measure of damages"]; Havell Capital Enhanced Mun. Income Fund, L.P. v Citibank, N.A., 84 AD3d 588, 589 [1st Dept 2011] [holding that "the fraud claim, which arose from the same facts, sought identical damages and did not allege a breach of any duty collateral to or independent of the parties' agreements, was redundant of the contract claim"]). New York courts have held that fraud claims against condominium sponsors and their members based on breaches of an offering plan and false certifications must be dismissed as duplicative of breach of contract claims (see e.g. Tiffany at Westbury Condominium v Marelli Dev. Corp., 40 AD3d 1073, 1077 [2d Dept 2007] [holding that plaintiffs' fraud claim against sponsor arising from misrepresentations in the offering plan was properly dismissed because "plaintiffs' cause of action for fraud was wholly duplicative of the breach of contract and warranty claims"] [Bd. of Managers of the Lore Condominium v Gaetano, 2012 NY Slip Op 32654[U], * 8 [Sup Ct, NY County 2012] [holding that plaintiff's fraud claim against the sponsor was duplicative because "[p]laintiff's fraud claim arises from the same allegations as its breach of contract claim that [the individual defendant], as [the sponsor's] principal, represented that he would construct the . . . [c]ondominium in accordance with the [O]ffering [P]lan and applicable laws, codes, and regulations, and he did not"]).
Here, plaintiff's fraud-based cause of action against Sponsor Defendants arises from purported breaches of the Offering Plan and the certification. Moreover, the damages sought by plaintiff for the fraud claims are indistinguishable from those sought in the breach of contract claim (compare Complaint Wherefore clause ¶¶ [a] and [e], NYSCEF Doc. No. 11, p. 21). Plaintiff asserts that "[it] does not merely allege that [Sponsor Defendants] were not sincere when they promised to perform under their respective contracts. Rather, [p]laintiff alleges . . . that [Sponsor Defendants] made specific representations, in the [o]ffering [p]lan, through other marketing materials and media, with the intent of inducing [p]laintiff unit owners to purchase their apartments without knowledge of the hidden and dangerous defects in the [b]uilding" (Plaintiff Opp. at 26). However, plaintiff makes no argument as to how its fraud damages are different from its breach of contract damages claim. Therefore, plaintiff's fraud-based cause of action must be dismissed as duplicative of its breach of contract cause of action (see Board of Mgrs. of 325 Fifth Ave. Condominium v Continental Residential Holdings LLC, 149 AD3d 472, 476 [1st Dept 2017] ["the fact that plaintiffs seek 'the same compensatory damages for both claims' indicates that they are duplicative"] [citation omitted]; Mañas v VMS Assoc., LLC, 53 AD3d 451, 454 [1st Dept 2008] [holding that the "plaintiff did not allege that she sustained any damages that would not be recoverable under her breach of contract cause of action . . . [therefore], the fraud-based causes of action [were] duplicative of the breach of contract cause of action"]).
Sponsor Defendants also argue that the fraud claims should be dismissed because the fraud claims are preempted by the Martin Act, as many of the purported misrepresentations that plaintiff identifies in the offering plan are required by law to be made, and thus, only the New York Attorney General may pursue claims based on the alleged misrepresentations. Under New York law, a purchaser of a condominium unit has no private right of action to bring a fraud claim based upon alleged misrepresentations in an offering plan because, under the Martin Act, the Attorney General maintains exclusive jurisdiction to prosecute such claims (see General Business Law §§ 352-354; Kerusa Co. LLC v W10Z/515 Real Estate Ltd. Partnership, 12 NY3d 236 [2009]).
Plaintiff contends the Martin Act does not apply, pointing to the following statements as the basis for its fraud claim:
a) "Sponsor has no knowledge of any inaccuracies or any material omissions or defects in the Description of Property" and "represents that it has no knowledge of any material defect or need for major repairs to the Property except as set forth in the Description of Property and Building Condition" section of the offering plan (Offering Plan attached as Exhibit C to Abramovits aff, NYSCEF Doc. No. 80 at 142);
b) The "Building incorporates sophisticated mechanical equipment" (id. at 37);
c) The offering plan promises unit owners would receive "all services normally associated with the operation and maintenance of a luxury rental condominium" (Complaint ¶ 41);
d) Sponsor defendants' statements to the Real Deal, a real estate publication, that "their projects are 'very bespoke, detail oriented and design oriented' and that 'we spend a tremendous amount of time with our layouts'" (Complaint ¶ 43);
e) Sponsor defendants told purchasers and the public that the building would be a "luxury building" "of premier caliber" "constructed with the highest quality materials and workmanship" (Complaint ¶ 47).
Plaintiff's fraud claim is pre-empted by the Martin Act (see Kerusa, 12 NY3d at 247 [finding that "cause of action for fraud relied entirely on alleged omissions from filings required by the Martin Act and the Attorney General's implementing regulations," and the fact "[t]hat [plaintiff] alleged the elements of common-law fraud does not transmute a prohibited private cause of action to enforce Martin Act disclosure requirements into an independent common-law tort"]). Plaintiff argues that Sponsor Defendants "made several false misrepresentations in the [O]ffering [P]lan" and "made these statements in the [O]ffering [P]lan to fraudulently induce the purchasers of the residential units to purchase said units" (Complaint ¶¶ 115-116), but these are the types of misrepresentations and omissions in an offering plan that the Court of Appeals in Kerusa found to be preempted by the Martin Act. For example, 13 NYCRR 20.3 (ag) provides that the "Sponsor must adopt the description of property and building condition set forth in Part II of the plan, and represent that sponsor has no knowledge of any material defects or need for major repairs to the property except as set forth in the description of property and building condition." Thus, Sponsor Defendants represented they had no knowledge of material defects per statement (a) above (see Offering Plan at 142). As another example, 13 NYCRR 20.3(e) (1) requires a general description by the sponsor of the facilities and amenities offered by the building. Thus, Sponsor Defendants complied, as demonstrated in statement (b) above (see Offering Plan at 37). Therefore, plaintiff's allegations in statements (a) and (b) above are preempted by the Martin Act.
With respect to plaintiff's remaining allegations regarding representations in the marketing and other materials in statements (c), (d) and (e) above (see Complaint ¶¶ 41, 43, 47), such claims amount to sales puffery and are not actionable (see Kerusa, 12 NY3d at 935, 942; Bd. of Managers of 141 Fifth Ave. Condo v 141 Acquisition Assoc. LLC, 2015 NY Slip Op 31940 [U], *10 [Sup Ct, NY County 2015] [holding that "promises contained in brochures and advertisements, promising, among other things the Building would be a first class luxury building amount [] to essentially little more than mere puffery, opinions of value or future expectations that do not constitute actionable fraud"] [internal quotation marks and citations omitted]).
The Court has considered the remaining arguments and finds them unavailing. Therefore, the branch of Sponsor Defendants' motion to dismiss the fraud-based fifth cause of action is granted.
Additionally, Sponsor Defendants move to dismiss the claim for violations of General Business Law [GBL] sections 349 and 350 as against them. Plaintiff opposes the motion. GBL section 349 prohibits "[d]eceptive acts or practices in the conduct of any business, trade or commerce or in the furnishing of any service in this state" (GBL § 349 [a]). The elements of a cause of action pursuant to this section are: "(1) a deceptive consumer-oriented act or practice which is misleading in a material respect, and (2) injury resulting from such act. In determining whether a representation or omission is a deceptive act, the test is whether such act is likely to mislead a reasonable consumer acting reasonably under the circumstances" (Andre Strishak & Assoc. v Hewlett Packard Co., 300 AD2d 608, 609 [2d Dept 2002] [internal quotation marks and citation omitted]; see also Solomon v Bell Atl. Corp., 9 AD3d 49, 52 [1st Dept 2004]). GBL section 350 declares unlawful "[f]alse advertising in the conduct of any business, trade or commerce or in the furnishing of any service in this state" (GBL § 350). The elements of a cause of action under this section are that "the advertisement: (1) had an impact on consumers at large, (2) was deceptive or misleading in a material way, and (3) resulted in injury" (Andre Strishak & Assoc., 300 AD2d at 609). "Similarly, the test is whether the advertisement is likely to mislead a reasonable consumer acting reasonably under the circumstances" (id. [internal quotation marks and citation omitted]).
Sponsor Defendants argue that plaintiff has failed to allege violations of GBL sections 349 and 350 because plaintiff did not plead that Sponsor Defendants engaged in conduct that impacted consumers at large. Plaintiff counters that Sponsor Defendants' alleged misrepresentations "were widely disseminated beyond only the [O]ffering [P]lan furnished to existing unit owners," including "print and internet media . . . in websites available to the general public and via the cable television show, Million Dollar Listing" (Plaintiff Opp. at 23).
To the extent that any of plaintiff's allegations are based on the Offering Plan, those are not actionable as this is a private contract dispute unique to the parties (see Thompson v Parkchester Apts. Co., 271 AD2d 311, 311-312 [1st Dept 2000] [ holding that plaintiffs failed to "set forth a viable claim under [GBL] § 349 since they have not met the threshold requirement for such a claim by showing that the alleged deceptive acts, if permitted to continue, would have a broad impact on consumers at large" because "[t]he presently litigated dispute, involving . . . what the individual plaintiffs were told about the condition of the plumbing when they purchased . . . is unique to the parties at this particular complex, and thus, does not fall within the ambit of the statute"]; Loeb v Architecture Work P.C., 154 AD3d 616, 616 [1st Dept 2017] [upholding dismissal of alleged violation of GBL § 349 because the action was "essentially a private contract dispute unique to the parties"] [citation omitted]). The alleged misrepresentations on websites and television programming are also not actionable (see Loeb, 154 AD3d at 616 -617 [holding that "even if, arguendo, defendant . . . engaged in consumer-oriented conduct by placing statements on its website, those statements were not likely to mislead a reasonable consumer acting reasonably under the circumstances; instead, they were mere puffery" [internal quotation marks and citations omitted]). Moreover, even if the statements on the websites and television programming were deceptive, they did not cause plaintiff's alleged injury resulting in damages for the fire sprinkler pipe bursting and other alleged defects (see id. at 617 [holding that "even if the statements on [the defendant's] website were deceptive, they did not cause plaintiff's injury" as "plaintiff's alleged injury was a result of specific acts and omissions by the individual defendant, such as failing to provide constructible drawings, re-designing the apartment's windows and doors without authorization, and failing to coordinate the project"]). Therefore, the branch of Sponsor Defendants' motion to dismiss the sixth cause of action alleging a claim for violations of GBL §§ 349 and 350 is granted.
In view of the foregoing, Sponsor defendants' motion to dismiss is granted to the extent of dismissing plaintiff's claims for fraud and fraudulent inducement (the fifth cause of action) and violations of GBL §§ 349 and 350 (sixth cause of action), and is denied without prejudice as to plaintiff's negligence and gross negligence claims (second cause of action) (motion sequence 003).
B. Claims Against Builder Defendants
Morris, ICOR, and Foundations (Builder Defendants) each separately move to dismiss the negligence and gross negligence claims as against them (motion sequences 001, 002, and 004). Builder Defendants each argue that the negligence and gross negligence claims are barred by the statute of limitations pursuant to CPLR 214, which states that the statute of limitations is three years for "an action to recover for damages of malpractice, other than medical, dental or podiatric malpractice, regardless of whether the underlying theory is based on contract or tort" (CPLR 214 [6]). These defendants contend that the accrual date for a design professional in a professional malpractice negligence claim is the date of completion of services and, as their services were completed over three years ago, plaintiff's negligence claims are barred by the statute of limitations. Plaintiff counters that its negligence claims are not barred because these claims are not malpractice claims from a direct contract or professional relationship between plaintiff and these defendants, and, thus, the accrual date is the date that the damage occurred, not the date of completion of services.
"While the Legislature has set forth the various Statutes of Limitations, to be measured from the time a cause of action accrues to the time the claim is interposed . . ., it has been left to the courts to determine when a cause of action accrues" (Fleishman v Eli Lilly & Co., 96 AD2d 825, 825 [2d Dept 1983]). "In general, it can be said that a cause of action for personal injuries, whether sounding in negligence [or] malpractice . . . accrues at the time of injury" (id.; see also Cubito v Kreisberg, 69 AD2d 738 [2d Dept 1979], affd, 51 NY2d 900 [1980]). "A sustainable general negligence claim asserted by a party that has no privity of contract accrues as of the date of the injury, which is when the damage is apparent" (AIG Property Cas. Co. v Property Markets Group, Inc., 2016 NY Slip Op 31560(U), *3 [Sup Ct, NY County 2016]). "Property damage is apparent, when the plaintiff either knows or in the exercise of diligence should have known the damage exists" (id.).
Assuming the truth of the allegations in plaintiff's pleading and "resolv[ing] all inferences which reasonably flow therefrom in favor of the [plaintiff]," the court agrees with plaintiff that the negligence claims are not professional malpractice negligence claims (Sanders, 57 NY2d at 394). There was no direct or other professional relationship between plaintiff and Morris, ICOR, or Foundations, and plaintiff asserts claims for property damages that it has incurred as a result of the alleged negligence. Plaintiff discovered the property damage on or after February 15, 2016, when the fire sprinkler pipe burst. Plaintiff commenced this action on December 19, 2016, thus it is timely.
Morris, ICOR, and Foundations also contend that the negligence and gross negligence claims should be dismissed as plaintiff lacks privity, or the functional equivalent thereof, with all three defendants. Plaintiff concedes an absence of privity (Plaintiff Opp. at 9-10, 16). However, this is not fatal to a negligence claim as, even in the absence of privity, New York law allows the assertion of a cause of action for negligence resulting in property damage (see 905 5th Assocs., Inc. v Weintraub, 85 AD3d 667, 668 [1st Dept 2011] [finding that "the lack of privity does not affect plaintiffs' ability to bring a general negligence claim against the [defendant] architect for property damage sustained by them" where there are "issues of fact as to whether the [defendant] directed or controlled the work which is alleged to have created the injury"]; Topcuoglu v Hotel 124, LLC, 2013 NY Slip Op 31232(U), *4 [Sup Ct, NY County 2013] [ finding that "[a] party who enters into a contract to perform construction-related services may be liable to third parties for personal injuries or property damage, despite the lack of privity . . ."]). Plaintiff asserts that its negligence-based cause of action is largely based on property damage and alleges that the Builder Defendants had responsibilities related to the construction that could be considered as controlling the work that caused the injury (Plaintiff Opp. at 19; Complaint ¶¶ 24-32, 110-113). City School Dist. of City of Newburgh v Hugh Stubbins & Associates, Inc. (85 NY2d 535 1995) can be distinguished because that plaintiff reviewed and approved specifications and had control during construction, giving it the functional equivalent of privity. Here, plaintiff alleges that it lacks privity with Morris, ICOR, and Foundations, but it is not clear whether these defendants reviewed and approved specifications and had control during construction of the building.
Accordingly, giving the plaintiff the benefit of every inference, the motions by defendants Morris, ICOR, and Foundations to dismiss the fourth cause of action for claims of negligence and gross negligence are denied (motion sequences 001, 002, and 004).
CONCLUSION
Accordingly, it is hereby
ORDERED that defendant Morris Adjmi Architects P.C.'s motion to dismiss (motion sequence 001) is granted to the extent of dismissing plaintiff's claims for breach of contract (third cause of action), fraud and fraud in the inducement (fifth cause of action), and violations of General Business Law §§ 349 and 350 (sixth cause of action), and is denied as to plaintiff's negligence and gross negligence claims (fourth cause of action); and it is further
ORDERED that defendant ICOR Associates, LLC's motion to dismiss (motion sequence 002) is granted to the extent of dismissing plaintiff's claims for breach of contract (third cause of action), and fraud and fraud in the inducement (fifth cause of action), and is denied as to plaintiff's negligence and gross negligence claims (fourth cause of action); and it is further
ORDERED that the motion to dismiss by 250 VE LLC, VE Equities LLC, Vella Group LLC, Zachary Vella and Justin Ehrlich (motion sequence 003) is granted to the extent of dismissing plaintiff's claims for fraud and fraudulent inducement (the fifth cause of action) and violations of General Business Law §§ 349 and 350 (sixth cause of action), and is denied without prejudice as to plaintiff's negligence and gross negligence claims (second cause of action); and it is further
ORDERED that defendant Foundations Group, Inc.'s motion to dismiss (motion sequence 004) is granted to the extent of dismissing plaintiff's claims for breach of contract (third cause of action), and fraud and fraud in the inducement (fifth cause of action), and violation of General Business Law §§ 349 and 350 (sixth cause of action), and is denied as to plaintiff's negligence and gross negligence claims (fourth cause of action); and it is further
ORDERED that defendants, except the Douglas Elliman defendants shall serve and file their answers within twenty (20) days of the date of this Decision and Order; and it is further
ORDERED that all counsel for the respective parties shall appear for a preliminary conference on Tuesday, July 3, 2018 at 10:30 AM in Part 49, Courtroom 252, 60 Centre Street, New York, New York.
This constitutes the decision and order of the court.
Dated: June 5, 2018
ENTER,
/s/ _________
O. PETER SHERWOOD J.S.C.