LLC v. << (2011)

-against-

Stonehenge Capital Company, LLC, et al.,

Defendants-Appellants,

Alan Brown, et al.,

Defendants.

Stern Tannenbaum & Bell LLP, New York (David S. Tannenbaum of counsel), for Stonehenge Capital Company, LLC, appellant.

McCarter & English, LLP, New York (Gregory J. Hindy of counsel), for W. Stephen Keller, appellant.

Goldman & Weintraub, P.C., Pine Plains (Robert E. Goldman of counsel), for Success, LLC, R & D Films, Inc., and Ethan Goldman, respondents.

Raskin Ritter, LLP, Culver City (Christopher I. Ritter of counsel), for Bad Company Films and Aldo Lapietra, respondents.

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Order, Supreme Court, New York County (Martin Shulman J.), entered February 23, 2010, which, to the extent appealed from, denied defendants-appellants' motions for summary judgment dismissing the fraud-based causes of action as against them and granted plaintiffs' cross motion for summary judgment solely to the extent that defendant Stonehenge is liable for the misrepresentations of defendant Keller, unanimously affirmed, with costs.

The fraud-based causes of action, which were stated with sufficient particularity (see CPLR 3016[b] ), were properly allowed to proceed.   Unlike the breach of contract claims that the motion court dismissed, the fraud claims are not based upon misrepresentations about the funding of plaintiffs' film project.   Rather, the fraud claims are based a misrepresentation of then-present facts, e.g., that the budget for the film had actually been approved and that all conditions precedent had been met.   Such misrepresentations are collateral to the contract, as they involve a breach of duty separate from a breach of contract (see First Bank of Ams. v. Motor Car Funding, 257 A.D.2d 287, 291-292 [1999] ).

The court's misstatement of fact in its order, namely, that a particular memorandum entitled “Success Film Financing Package” had been circulated to defendant Stonehenge, does not affect our determination.

We have considered appellants' remaining contentions and find them unavailing.

THIS CONSTITUTES THE DECISION AND ORDER

OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.

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CLERK