LLC v. DBA THE CHESED WORLD CHAIM HERSKOWITZ (2026)

The following papers, numbered 1, were read and considered in connection with Plaintiff's Notice of Motion (Motion Seq. No. 1) for an Order, pursuant to Civil Practice Law and Rules § 3212 granting Plaintiff, First Data Merchant Services LLC, Summary Judgment against Defendant and for such other and further relief as to the Court may seem just, proper, and equitable:

PAPERS NUMBERED

Notice of Motion (Motion Seq. No. 1)/Affirmation of Joel S. Schneck, Esq./ Exhibits A-C/Affirmation of Carolyn Barrett — Exhibits 1-2 /Memorandum of Law/Affirmation of Service/Affirmation of Non-Military 1

Affirmation of Joshua Bronstein, Esq./Affidavit of Chaim Herskowitz/Affidavit of Service 2

Reply Affirmation of Joel S. Schneck, Esq./Exhibit A-B 3

Letter from Joshua R. Bronstein, Esq. dated May 15, 2026 4

The instant action for breach of a Merchant Processing Application and Agreement (hereinafter Agreement) was commenced by Plaintiff by filing a Summons and Verified Complaint and a copy of the agreement on March 31, 2025. See NYSCEF Doc. No. 1. According to Plaintiff's Affidavit of Service Defendant CHAIM HERSKOWITZ (hereinafter HERSKOWITZ) was served at 20 Decatur Ave #105, Spring Valley, New York on April 8, 2025, pursuant to Civil Practice Law and Rules § 308(1). See NYSCEF Doc. No. 2. Additionally, Defendant HERSKOWITZ was served with the Summons and Complaint via United States Postal Service on April 21, 2025, pursuant to Civil Practice Law and Rules § 3215(g)(3)(i). No proof of service has been filed as to Defendant CHESED SH'EBCHESED INC, DBA THE CHESED WORLD (hereinafter CHESED). Nonetheless, on May 5, 2025, Defendant CHESED filed an Answer raising twenty-three Affirmative Defenses. See NYSCEF Doc. No. 5. Defendant HERSKOWITZ has not filed an answer or joined issue.

On February 11, 2026  ¹ Plaintiff filed the instant motion pursuant to Civil Practice Law and Rules seeking summary judgment. See NYSCEF Doc. No. 6.

FACTS/BACKGROUND

The contract at issue, the Agreement, was entered into on December 17, 2020, by the Plaintiff and Defendant CHESED, a religious organization. See NYSCEF Doc. No. 11. Defendant HERSKOWITZ signed a personal guaranty in which guaranteed Defendant CHESED's obligations under the Agreement. See NYSCEF Doc. No. 11, ¶ 10. According to the Affirmation of Carolyn Barrett, an agent of Plaintiff, from December 2023 through April 2024 Defendant CHESED's account had an "abnormal" amount of chargebacks and the Defendant failed to fund the unfunded chargebacks resulting in an outstanding balance of $506,961.61. See NYSCEF Doc. No. 11 and Exhibit 2.

ARGUMENTS

Plaintiff contends that they have satisfied their prima facie burden as to the causes of action sounding in breach of contract and account stated.

First, as to the breach of contract claim, Plaintiff asserts that they have satisfied all of the elements of the cause of action through the affirmation of Carolyn Barrett, an agent of Plaintiff who has personal knowledge of the essential facts, records and business practices related to Defendants' account. In addition, Plaintiff avers that along with the Barrett Affirmation they have provided the documents created, accumulated and retained by Plaintiff in the course of their business as to Defendants' account. Plaintiff argues that based upon the Barrett Affirmation and Plaintiff's business records they have established all of the terms of the Agreement and Defendants' breach of the agreement by failing to fund the chargebacks.

Next, Plaintiff avers that all of the elements of the account stated cause of action were also demonstrated by the Barrett Affirmation and the business documents provided as to the Defendants' account. Plaintiff provided the Defendant with accounts of the monies owed on their account in the amount of $506,961.61, accepted the accounts and retained them without objection. As such, Plaintiff contends that they have established Defendants' failure to pay upon the demand for the monies. As to the personal guaranty signed by Defendant HERSKOWITZ, the Plaintiff asserts that there is no dispute that it was signed and that HERSKOWITZ is responsible for Defendant CHESED's nonpayment.

Defendant HERSKOWITZ submitted opposition in the form an affidavit, despite never filing an answer individually, and asserts that he is the owner of Defendant CHESED. In addition, an affirmation is filed in support of the opposition by Jonathan Bronstein, Esq., counsel who filed an Answer solely on behalf of Defendant CHESED. Despite the insufficiencies of these filings, the Plaintiff has failed to raise any issues with the opposition as filed and therefore the Court will consider Defendant HERSKOWITZ's Affidavit and Attorney Bronstein's Affirmation and the annexed documents as opposition for both Defendants.

Defendants contend that the Plaintiff's application for summary judgment as to the breach of contract claim is premature and that discovery is needed before summary judgment can be sought in this matter. As to discovery, the Defendants assert that a forensic account and discovery are needed to audit the accounts and third-party subpoenas could be needed. The Defendants also assert that Plaintiff's motion is deficient since they have failed to provide "specifics" as to the reason the chargebacks occurred and who is responsible for the chargebacks. According to Defendants, chargebacks occur for many reasons and Plaintiff's assertion that Defendants failed to fund the chargebacks resulting in a balance is a conclusory statement and does not demonstrate liability to the Plaintiff for the chargebacks. Further, Defendants argue that since each transaction has its "own reason and proof," which the Plaintiff has not provided they cannot seek a bulk sum. Additionally, the Defendants argue that the personal guaranty is meritless because the Defendants have failed to provide the person who is responsible or liable specifically for the charge backs.

In opposition to the application for summary judgment as to the account stated claim, the Defendants contend that Plaintiff's application is insufficient since they have failed to include proof of mailing of the account statements or proof that Defendants received the statements. Defendant HERSJOWITZ unequivocally states that he did not receive any default notices or a demand for payment.

In reply Plaintiff contends that Defendant HERSKOWITZ's opposition contains limited factual statements, lacks evidentiary support and ignores the terms of subject contract as to the Defendants' liability for the chargebacks. Also, Plaintiff argues that Defendants' claim that the instant motion is premature is meritless, as the Defendants filed an answer to the Complaint on May 5, 2025, and never filed and served any discovery demands. Nonetheless, Plaintiff states that on June 26, 2025, he spoke with Defendants' counsel and as a result of the conversation Plaintiff sent a zip drive containing all of the chargeback documentation via email on September 18, 2025, to Defendant's counsel. No arguments were raised in reply by Plaintiff as to the account stated cause of action.

LAW/ANALYSIS

The proponent of a summary judgment motion must establish its claim or defense sufficient to warrant a court directing judgment in its favor as a matter of law, tendering sufficient evidence to demonstrate the lack of material issues of fact. See Giuffrida v. Citibank Corp., et al., 100 NY2d 72 [2003] citing Alvarez v Prospect Hosp., 68 NY2d 320 [1986]. The failure to do so requires a denial of the motion without regard to the sufficiency of the opposing papers. See Lacagnino Gonzalez, 306 AD2d 250 [2d Dept. 2003]. However, once such a showing has been made, the burden shifts to the party opposing the motion to produce evidentiary proof in admissible form demonstrating material questions of fact requiring trial. See Gonzalez v 98 Mag Leasing Corp., 95 NY2d 124 [2000] citing Alvarez, supra; See also Winegrad v New York Univ. Med. Center, 64 NY2d 851 [1985]. Mere conclusions or unsubstantiated allegations unsupported by competent evidence are insufficient to raise a triable issue. See Gilbert Frank Corp. v Federal Ins. Co., 70 NY2d 966 [1988]; See also Zuckerman v City of New York, 49 NY2d 557 [1980].

Breach of Contract Claim

" 'The essential elements of a cause of action to recover damages for breach of contract are 'the existence of a contract, the plaintiff's performance pursuant to the contract, the defendant's breach of its contractual obligations, and damages resulting from the breach.' " Cruz v Cruz, 213 AD3d 805, 807 [2d Dept 2023] quoting Klein v Signature Bank, Inc., 204 AD3d 892, 895 [2d Dept2022].

Plaintiff has established its entitlement to judgment, as a matter of law, by providing the Court with an affidavit from a representative familiar with Plaintiff's record keeping practices, documentary evidence of the monies owed, the transaction history, the Agreement, the account maintained by Plaintiff as to the Agreement, an inventory of the dates and amounts for the chargebacks, evidence of Defendants' default, and copies of the pleadings. The Court will note that the reverse and collection statement submitted by Plaintiff demonstrates that beginning April 14, 2024, and continuing daily and often multiple times a day, there were chargebacks on Defendants' account and none of the monies were credited back.

The burden then, shifted to Defendants to produce admissible evidence showing one or more disputes of material fact. See Fleet Credit Corp. V. Harvey Hutter & Co. Inc., 207 AD2d 380 [2d Dept 1994]. Defendants' opposition is rife with speculative and conclusory statements that are red herrings. The amount of or cause of the chargebacks is not relevant to Section 14 of the Program Guide incorporated into the Agreement which delineates that Defendant CHESED is responsible for all chargebacks, the chargeback fees and related costs arising from the transaction. The Defendants do not dispute that the chargebacks occurred or that they paid the chargeback amounts or the amount of any fees and costs related to the chargebacks. As such, Plaintiff's motion for summary judgment as to the breach of contract cause of action is granted.

Account Stated Claim

"An account stated is an agreement between parties as to an account and the correctness of account items and a specific balance due on them." White Plains Cleaning Services, Inc v 901 Properties, Inc., 94 AD3d 1108, 1109 [2d Dept 2012]. This agreement is independent of the original obligation. See Citibank [S.D.] v Cutler, 112 AD3d 573, 573-574 [2d Dept 2013]. "A cause of action for an account stated has been described as 'an alternative theory of liability to recover the same damages allegedly sustained as a result of the breach of contract.' " Episcopal Health Services, Inc. v Pom Recoveries, Inc., 139 AD3d 917, 919 [2d Dept 2016] quoting A Montilli Plumbing & Heating Corp. v Valentino, 90 AD3d 961, 962 [2d Dept 2011]. "An essential element of an account stated is that the parties came to an agreement with respect to the amount due." Id. A party's silence or failure to object to an account stated cannot be interpreted as an agreement that the account is correct but upon consideration of the facts surrounding a particular transaction the absence of an objection within a reasonable time may result in an implied account stated. See id. quoting Interman Inds. Prods. V R.S.M. Electron Power, 37 NY2d 151, 154 [1975].

Here, the Plaintiff has failed to demonstrate through their evidentiary submissions that the parties came to an agreement as to the amount due. The Plaintiff failed to provide any documentation that account statements were sent to Defendants that were ignored or disputed. The Verified Complaint and the Barrett Affidavit do not provide the dates when the alleged account statements were sent to the Defendants, where the statements were sent and to whose attention. Further, no copies of account statements that were sent to Defendants have been included in the instant application.

Based upon the foregoing, the Plaintiff's motion for summary judgment as to the breach of contract claim is granted and denied as to the cause of action for account stated.

In arriving at this decision the Court has reviewed, evaluated and considered all of the issues framed by these motion papers and the failure of the Court to specifically mention any particular issue in this Decision and Order does not mean that it has not been considered by the Court in light of the appropriate legal authority.

Accordingly, it is hereby

ORDERED that the Plaintiff's Motion for Summary Judgment is granted in part and denied in part; and it is further;

ORDERED that Plaintiff is directed to submit a Proposed Judgment consistent with the foregoing on Notice to Defendants within fifteen (15) days of the date hereof.

The foregoing constitutes the Decision and Order of this Court on Motion Seq. No. 1.

Dated: August 10, 2026

New City, New York

HON. JOHN P. COLLINS, JR., J.S.C.

FOOTNOTES

1.   The motion papers filed by Plaintiff on February11, 2026 are dated and signed on February 9, 2026.

John P. Collins, Jr., J.