ZHONG LUN LAW FIRM LLC v. LLP (2024)

Order, Supreme Court, New York County (Joel M. Cohen, J.), entered September 19, 2023, which granted the motion of defendant Zhong Lun New York LLP (ZL New York) to dismiss the amended complaint as against it, unanimously affirmed, with costs.

The motion court properly dismissed the claims in the amended complaint against defendant ZL New York arising out of an alleged oral agreement between plaintiff and defendant Zhong Lun Law Firm (the firm) on a theory of reverse piercing the corporate veil to hold ZL New York liable for the firm's alleged breach (see e.g. Sweeney, Cohn, Stahl & Vaccaro v. Kane, 6 A.D.3d 72, 75, 773 N.Y.S.2d 420 [2d Dept. 2004], lv dismissed 3 N.Y.3d 751, 788 N.Y.S.2d 661, 821 N.E.2d 965 [2004]).  Plaintiff acknowledges that the amended complaint relies solely on an alter ego theory for imputing the firm's liability to ZL New York, which the motion court correctly found does not apply to the facts alleged here.

Although plaintiff pleaded certain hallmarks of an intermingled identity between the firm and ZL New York, such as a shared trade name and shared office systems, the amended complaint lacks allegations as to how this purported abuse of the corporate form was used to perpetrate a wrong against plaintiff, which is fatal to its claim (see e.g. Board of Mgrs. of the Gansevoort Condominium v. 325 W. 13th, LLC, 121 A.D.3d 554, 555, 993 N.Y.S.2d 901 [1st Dept. 2014]).  With respect to the claim for breach of the implied covenant of good faith and fair dealing, because there is no contract between plaintiff and ZL New York, the claim “fails in the absence of an enforceable contract in which the covenant would be implied” (Core Dev. Group LLC v. Spaho, 199 A.D.3d 447, 449, 157 N.Y.S.3d 416 [1st Dept. 2021]).

We have considered plaintiff's remaining contentions and find them unavailing.