ZEGELSTEIN v. Jed Kaminetsky, M.D., et al., Defendants. (2020)

Order, Supreme Court, New York County (Anil C. Singh, J.), entered June 12, 2017, which, insofar as appealed from as limited by the briefs, denied plaintiffs' cross motions for an extension of time to serve a summons and/or complaint, unanimously affirmed, with costs.

Plaintiffs provided patient anesthesia services at the offices of defendants Michael J. Faust, M.D., Michael P. Krumholz, M.D., Jed Kaminetsky, M.D., and Alan Raymond, M.D. (the Specialist Defendants) for various periods between 2002 and 2011.  Defendant Haroon Chaudhry, M.D. was employed by plaintiffs as an anesthesiologist between 2002 and 2004.  Plaintiffs allege that the Specialist Defendants secretly collected fees from insurers and patients that were due to plaintiffs in breach of their agreements not to collect payments on behalf of or due to plaintiffs.  Plaintiffs also allege that, after his departure from their employ, Chaudhry falsely identified himself as being affiliated with plaintiffs and re-directed payments due to plaintiffs to himself.

In support of their motions for an extension of time for service pursuant to CPLR 306–b, plaintiffs failed to demonstrate either “good cause” for not timely serving defendants or that an extension of time was warranted “in the interest of justice.”  Plaintiffs' lack of diligence precludes a finding of good cause (see generally Henneberry v. Borstein, 91 A.D.3d 493, 496, 937 N.Y.S.2d 177 [1st Dept. 2012]).  Their excuses for not timely serving defendants amount at best to law office failure, which is insufficient (see id. at 495–496, 937 N.Y.S.2d 177; Rodriguez v. Consolidated Edison Co. of N.Y., Inc., 163 A.D.3d 734, 736, 81 N.Y.S.3d 404 [2d Dept. 2018]).  Moreover, although plaintiffs were alerted to a potential service issue months earlier, they did not move for an extension until after defendants brought their motions to dismiss (see Johnson v. Concourse Vil., Inc., 69 A.D.3d 410, 410–11, 892 N.Y.S.2d 358 [1st Dept. 2010], lv denied 15 N.Y.3d 707, 909 N.Y.S.2d 21, 935 N.E.2d 813 [2010]).

An “interest of justice” extension is also unwarranted (see generally Leader v. Maroney, Ponzini & Spencer, 97 N.Y.2d 95, 105–106, 736 N.Y.S.2d 291, 761 N.E.2d 1018 [2001]).  In addition to plaintiffs' extreme lack of diligence, the statute of limitations on the majority of plaintiffs' claims appears to have expired prior to initiation of this action, although it is difficult to say with certainty due to the lack of specificity in the complaint (see Yardeni v. Manhattan Eye, Ear & Throat Hosp., 9 A.D.3d 296, 297–298, 780 N.Y.S.2d 140 [1st Dept. 2004], lv denied 4 N.Y.3d 704, 792 N.Y.S.2d 897, 825 N.E.2d 1092 [2005]).  This lack of specificity also weighs against allowing an extension, as does the prejudice suffered by defendants, who were unable to timely investigate plaintiffs' claims (see Johnson, 69 A.D.3d at 411, 892 N.Y.S.2d 358).

We decline to address defendants' arguments regarding mootness, which are raised for the first time on appeal.  We also do not find that sanctions are warranted at this time.