NY Commercial Division Blog

Visit the Full Blog

Patterson Belknap’s Commercial Division Blog covers developments related to practice and case law in the Commercial Division of the New York State Supreme Court.  The Commercial Division was formed in 1993 to enhance the quality of judicial adjudication and to improve efficiency in the case management of commercial disputes that are litigated in New York State courts. Since then, the Division has become a leading venue for judicial resolution of high-stakes and every-day commercial disputes.  This Blog reviews key developments in the Commercial Division, including important decisions handed down by the Commercial Division, appellate court decisions reviewing Commercial Division decisions, and changes and proposed changes to Commercial Division rules and practices.  Our aim is to provide you with thoughtful and succinct analysis of these issues.  The Blog is written by experienced commercial litigators who have substantial practices in the Commercial Division. It is edited and managed by Stephen P. Younger and Muhammad U. Faridi, who spearheaded the publication of the New York Commercial Division Practice Guide, which is part of Bloomberg Law's Litigation Practice Portfolio Series.

Commercial Division Considers Effects of COVID Executive Orders on Use and Occupancy Payments for Real Estate

A recent ruling by the Kings County Commercial Division offers a glimpse into how courts in New York may resolve COVID-19-related disputes regarding leases and real property, as well as how courts may handle situations in which the Governor’s executive orders, intended to stem the spread of COVID-19, have affected the abilities of parties to follow court orders issued prior to the pandemic. 

Go

New Oral Argument Protocol at the First Department

On August 17, 2020, the Appellate Division, First Department announced that starting in the September term, and continuing until further notice, it will hold oral arguments both in-person at the courthouse and remotely via Microsoft Teams.  In-person oral arguments will be held on Wednesdays and remote oral arguments will be held on Tuesdays, Thursdays, and Fridays. 

Go

Second Department to Allow Virtual Option for Oral Arguments

Starting on September 8, 2020 and continuing indefinitely, litigants eligible for oral argument in the Second Department will be given the option of arguing in person, via Microsoft Teams, or submitting.  Notice must be sent to the court and other litigants no later than three days prior to the date on which the matter is calendared.  If there is a divergence of opinion among litigants, the court will determine how oral argument will be heard or whether the matter will be marked submitted.  Members of the public are still not permitted to attend oral argument at the courthouse.

Go

Appellate Division, First Department Expands Mandatory E-filing

The Appellate Division, First Department has expanded the categories of appeals subject to e-filing through the New York State Court Electronic Filing System (NYSCEF).  Effective July 27, 2020, e-filing is now mandatory for all matters originating in Supreme Court, Criminal Term; Family Court; Surrogate’s Court; and Court of Claims in Bronx and New York Counties.  With this expansion, e-filing is now mandatory for all matters before the First Department, except Original Special Proceedings and Attorney Matters.

The expansion applies to appeals that have already been perfected, and is required regardless of whether the matters were e-filed at trial level.  Attorneys in matters where notices of appeal have been filed are encouraged to immediately enter the initial information required for e-filing under 22 NYCRR § 1245.3.  There are separate 22 NYCRR § 1245.3. considerations for criminal and family matters with assigned counsel, and such practitioners should consult the notice to the bar.

Go

New York Court of Appeals Resumes In-person Filings

On July 22, 2020, the New York Court of Appeals announced that the Court of Appeals Hall in Albany is now open for in-person filings.  The Court will continue to accept mailed and electronic submissions as permitted by its rules.  Those seeking to file papers in person will be screened at the Court’s Eagle Street entrance before entering in accordance with New York’s COVID screening protocol.

Go

Commercial Division Resolves Madoff-related Dispute Pursuant to LLC Law

The reverberations from the collapse of Bernie Madoff’s massive Ponzi scheme continue to be felt in Manhattan’s Commercial Division.  On May 20, 2020, Judge Joel M. Cohen issued a decision in Matter of FGLS Equity LLC, No. 157170/2019, 2020 WL 2557877, 2020 NY Slip Op 31476(U) (Sup. Ct., N.Y. Ctny., May 20, 2020), approving the liquidation plan of FGLS Equity LLC, which was founded by accountant Steven Mendelow as a feeder fund to Bernard L. Madoff Investment Securities (BLMIS).  Mendelow, who passed away in 2016, was allegedly instrumental in funneling investors to the scheme.  The decision is notable, not least because it may be the first New York case in which a court has been asked to pass judgment on an LLC plan of liquidation proposed by a liquidator appointed by the LLC’s members pursuant to its operating agreement. 

Go

Updates on COVID-19’s Impact on Commercial Appeals: New York Court of Appeals Expands Digital Filings, While the Appellate Division Lifts Moratorium on Filing Deadlines and Hears Skype Argument

Originally published May 21, 2020.

The progress of taking commercial appeals in New York has been impacted significantly by the onset of the COVID-19 pandemic.  Deadlines for perfecting appeals were suspended and oral arguments were canceled. Although Skype conferences were being held in the trial level courts, such as the Commercial Division, arguments were not being scheduled on typical appeals. Recently, as Chief Judge Janet DiFiore has overseen a gradual re-opening of significant portions of the New York courts, there have been material developments in appellate practice which affect commercial litigators.  These developments reflect a sense that appeals are starting to move forward again, albeit with the naturally attendant backlogs that the COVID-19 crisis has engendered.

Go

Presiding Justices of the Appellate Division Participate in Virtual Town Hall

The COVID-19 pandemic has had considerable effect on appellate practice in New York State’s intermediary appellate court, the Appellate Division.  The last months have seen historical firsts, such as all four appellate departments hosting virtual oral arguments on Zoom and Skype.  Many parties have not had the opportunity to take part in oral argument, as their cases have been decided on submission or adjourned.  The four departments have issued a flurry of notices to the bar revising their rules of practice and many of these changes could very well be permanent. 

Go

Commercial Division Asserts its Role in Securities Litigation

In Hoffman v. AT&T Inc., Justice Ostrager of the Commercial Division recently denied a motion to stay a securities class action in favor of a subsequently filed and more comprehensive action brought in the Southern District of New York (SDNY).  In doing so, he asserted the Commercial Division’s role in securities litigation following the U.S. Supreme Court’s decision in Cyan, Inc. v. Beaver Cty. Emps. Ret. Fund, 138 S. Ct. 1061 (2018).    

Go

Commercial Division Decision Applies Issues Frequently Considered on Motions to Dismiss

In considering a motion to dismiss related to a real estate development joint-venture gone bad, a recent decision by Justice Andrea Masley in 3P-733, LLC v Davis (No. 650800/2018 [N.Y. Sup. Ct., N.Y. Cty., April 2, 2019]) highlights several issues that frequently arise at the motion to dismiss stage in the Commercial Division.

Go

The First Department Reconsiders Approval of a Class Action Settlement

On April 11, 2019, the First Department unanimously affirmed a decision issued by Justice Shirley Werner Kornreich, formerly of the Commercial Division, which denied the plaintiffs’ motion for final approval of a class action settlement in City Trading Fund v. Nye (2019 NY Slip Op 02789). This was the second time the Appellate Division had considered Justice Kornreich’s denial of approval of a settlement in this case, having reversed her prior denial of preliminary approval of the settlement in November 2016 and remanding the case for a fairness hearing in order to review the settlement terms.

Go

Commercial Division Is Coming to the Bronx

At her annual State of the Judiciary speech held on February 26, 2019 at Bronx County Supreme Court, Chief Judge Janet DiFiore announced that the Commercial Division will be expanding to Bronx County, effective April 1, 2019.  The Chief Judge explained that this expansion was in recognition of the Bronx’s ongoing economic resurgence and the growing number of commercial cases being filed there.  There has not yet been any announcement as to the jurisdiction of this new part or which judges will be assigned to it.  

Go

Commercial Division: Past, Present and Future - New York City Bar Association Program

On Monday February 26, 2019, four retired Justices of the Commercial Division, New York County – Justices Ellen Bransten, Shirley Kornreich, Charles Ramos, and Melvin Schweitzer – took the stage at the New York City Bar to discuss the past, present and future of the Commercial Division, as well as their own experiences on the court.  The discussion was moderated by retired Justice Carolyn Demarest of the Commercial Division, Kings County. 

Go