3502 PARTNERS LLC v. METROPOLITAN TRANSPORTATION AUTHORITY (2026)

Order, Supreme Court, New York County (Dakota D. Ramseur, J.), entered November 20, 2024, which granted plaintiff's motion for leave to amend its complaint, unanimously affirmed, without costs.

Supreme Court providently exercised its discretion in granting plaintiff's motion for leave to amend the complaint to include allegations of gross negligence.  Plaintiff sufficiently demonstrated that the proposed amendment was not palpably insufficient or clearly devoid of merit (see MBIA Ins. Corp. v. Greystone & Co., Inc., 74 A.D.3d 499, 499–500, 901 N.Y.S.2d 522 [1st Dept. 2010]).  The new allegations, if proven, may be sufficient to establish that defendants acted with reckless disregard for plaintiff's rights, or did not even exercise slight care.  Defendants failed to demonstrate either surprise or prejudice from the proposed amendment (see CPLR 3025[b];  Murray v. City of New York, 43 N.Y.2d 400, 405, 401 N.Y.S.2d 773, 372 N.E.2d 560 [1977];  Pier 59 Studios, L.P. v. Chelsea Piers, L.P., 40 A.D.3d 363, 366–367, 836 N.Y.S.2d 68 [1st Dept. 2007]).  The proposed amended complaint does not seek to add entirely new facts, and instead relies on material provided by defendants late in the discovery phase to assert that defendants’ conduct, related to the same events set forth in the initial complaint, rises to a level sufficient to establish gross negligence.  Supreme Court made clear that defendants will be given an opportunity to conduct discovery necessary to address the gross negligence claim and make dispositive motions if warranted.  There is no indication that defendants have lost the opportunity to obtain evidence or testimony because of any delay.

Defendants failed to argue before Supreme Court that some of them may be immune from an award of punitive damages because of their alleged status as public benefit corporations.  In any event, defendants have failed to make a sufficient showing that all of them would be immune from punitive damages, and there is no dispute that one of them — Tutor Perini Corporation — does not qualify as a public benefit corporation.  Thus, even assuming that some of the defendants enjoy immunity, that fact does not lead to conclusion that plaintiff's proposed gross negligence cause of action is entirely devoid of merit.

We have considered defendants’ remaining arguments and find them unavailing.