WHITE v. VACCARO (2026)

Order, Supreme Court, New York County (Melissa A. Crane, J.), entered January 6, 2026, which, to the extent appealed from as limited by the briefs, denied defendants' motion to vacate a preliminary injunction to the extent it directed the parties, former law partners, to escrow 50% of all contingency fees collected in connection with personal injury actions that originated under the plaintiff former partnership to the extent the contingency fees were received postdissolution of the partnership, and which allegedly compelled defendant Vaccaro to continue funding the dissolved firm's website for plaintiff's business purposes, unanimously modified, on the law, to modify the branch of the preliminary injunction order that directs the parties to escrow 50% of contingency fees received on their former partnership's legacy cases, postdissolution, and otherwise affirmed, without costs.

CPLR 6314 provides that “[a] defendant enjoined by a preliminary injunction may move at any time, on notice to the plaintiff, to vacate or modify it” (see Morris v. 702 E. Fifth St. HDFC, 8 AD3d 27, 29 [1st Dept 2004] ).  A motion to vacate or modify a preliminary injunction may be granted, in the discretion of the court, either upon compelling or changed circumstances that render continuation of the injunction inequitable, or upon a failure to proceed expeditiously (Wellbilt Equip.  Corp. v. Red Eye Grill, 308 A.D.2d 411, 411–412 [1st Dept 2003];  see also Wynkoop v 622A President St. Owners Corp., 169 AD3d 1103, 1105 [2d Dept 2019] ).  To preserve the status quo pending a resolution of the parties' dispute on the merits, including the proper application of In re Thelen LLP, (24 NY3d 16 [2014] ), this Court declines to vacate the preliminary injunction.

Nevertheless, a modification to the branch of the preliminary injunction order that directs an escrow of 50% of the contingency fees received on legacy matters post-dissolution is fair and equitable under the circumstances.  Defendants persuasively argue that the $1,800,000 escrowed by defendants should be offset by the $750,000 escrowed by plaintiffs such that defendants are only required to escrow $1,050,000.  The foregoing relief preserves plaintiffs' entitlement to contingency fees arising from legacy matters, while mitigating any prejudice to defendants by releasing $750,000 from the funds held in escrow.

We have considered the remaining arguments and find them unavailing.